Fix and flip loans cover both the acquisition cost and renovation budget for properties an investor intends to resell quickly. Lenders evaluate the after-repair value (ARV) to determine the loan amount, typically lending up to 70-90% of ARV. These loans usually carry terms of 6 to 18 months with interest-only payments, allowing investors to maximize cash flow during the renovation period. Successful flippers negotiate rehab draws, where the lender releases renovation funds in stages as work is completed and inspected.