Fix and Flip Loan Overview

Underwriting Philosophy

ALTloan takes a common sense approach to underwriting short term 1st & 2nd TD Bridge Loans for Real Estate Investors. Each Property and Borrower is weighed on its own merits. Our goal is to help our Borrowers exit each loan transaction successfully and to mitigate risks for our Investors. We mitigate risks with credit grading and deferred maintenance guidelines.

Program Description

ALTloan's Bridge Loans are short term transitional financing for investment purposes (i.e. borrowers managing their own improvements and/or deferred maintenance, stabilizing the property’s income, getting cash-out for business and other

  • Loan Types: 6, 12, 18, 24, 36, and 48 Month Interest Only
  • Deferred Maintenance: Property can be in poor condition with Appraiser C1-C6 condition rating and/or Q1-Q6 quality rating allowed
    • UNINHABITED: properties can have deferred maintenance with safety and habitability
    • INHABITED: properties with safety or habitability issues must be cured prior-to-close
    • In both cases above, if the loan amount plus the cost-to-cure the deferred maintenance as stated by the appraiser exceeds 80% of the property’s value (lower of the as-is or purchase values), two times the amount of the deferred maintenance exceeding 80% must be collected at close in an escrow account. Funds are to be released from the escrow account upon inspection and approval by an ALTloan appraiser and underwriter. At no time are properties to be inhabited until repairs are complete if the deferred items have safety or habitability issues. Additionally, ALTloan requires builder risk insurance on all loans where deferred maintenance is being repaired after the loan closes. See Project Insurance Requirements, 12.1.5.1 in ALTloan Underwriting Guidelines.

Program Parameters

Geographic RestrictionsTRID States: California Only (ALTloan is licencsed with the CA BRE) Non-TRID States:
Property TypesSFR, 2-4 Units, Condominium, Multi-Family 5+, Mixed Use
Loan Amount Restrictions
  • If 1st TD: $250,000 to $3,000,000
  • If 2nd TD: $100,000 to $1,000,000
Minimum Interest Bridge
TermMinimum I.O. Payments
6 Month3 Months
12 Month6 Months
18 Month9 Months
24 Month12 Months
36 Month18 Months
48 Month24 Months
Payment PenaltiesNone (see minimum interest above)
ImpoundsNone
OccupancyNon-Owner Occupied Only or Entity Occupied