Heavy rehab where the budget exceeds half the purchase price
The rehab costs more than half of what I'm paying for the property — does that change financing?
When rehab is the larger dollar amount in the deal, loan-to-cost is the number to ask about first — a lender that looks generous on loan-to-value can still fall short on total cost.
- Fix-and-flip loan sized on loan-to-cost When rehab dollars dominate the budget, the percentage of total cost — purchase plus rehab — a lender will fund matters more than the purchase price alone.
- A loan sized only as a percentage of purchase price Sizing to purchase price ignores that most of the cash going into this deal is rehab money, and understates what the project actually needs.
Lenders in the directory
Who publishes criteria this deal clears
Matched across all 37 lenders in the directory on published maximum loan-to-cost. This list is computed from stored criteria, not curated — it changes when a lender’s published figures change.
Writes the product, has not published the threshold
These 5 carry a relevant product but have not published the figure this scenario depends on, or carry no verification date. We will not claim they qualify and we will not claim they do not — ask them directly.
Why LTC and LTV tell different stories here
Loan-to-value is measured against the property's value; loan-to-cost is measured against what the deal actually costs to execute — purchase plus rehab. On a light rehab the two numbers stay close together. Once rehab passes half the purchase price, the total cost basis grows a lot faster than the purchase price alone, and a lender's loan-to-cost ceiling, not its loan-to-value ceiling, is what decides how much of that total gets financed.
What the roster below is testing
The lenders listed have published a maximum loan-to-cost figure at a level this kind of deal needs. That's a real, checkable claim about a published number — it isn't a statement that any specific one of them will approve this specific project, which still depends on the file.
Where the rest of the cash comes from
The gap between the loan amount and total project cost is the borrower's cash to close, plus whatever contingency reserve sits on top of the contractor's bid. A high loan-to-cost ceiling narrows that gap; it doesn't eliminate it.
Draw structure matters more on a project this size
A rehab budget this large is almost always disbursed across several draws tied to completed, inspected phases rather than a single release. See how rehab loan draw schedules work for how that process actually runs.
What to have ready
- An itemized scope of work with contractor bids, not a lump-sum estimate
- A contingency reserve on top of the total bid
- Proof of the cash needed to cover the gap between the loan and total project cost
- A draw schedule the contractor can realistically work against
Questions
Why does loan-to-cost matter more than loan-to-value on a heavy rehab?
Does a higher loan-to-cost ceiling mean less cash needed at closing?
What if the rehab budget grows mid-project?
Is a heavy rehab treated differently from ground-up construction?
Terms used on this page
- After Repair Value (ARV) — After repair value is the estimated market value of a property once planned renovations are finished. It is the basis for most fix-and-flip and BRRRR lending decisions.
- Asset-Based Lending — Asset-based lending underwrites primarily on the value and income of the collateral rather than the borrower’s personal income. In real estate this covers hard money, bridge and DSCR loans.
- The 70% Rule — The 70% rule says a flipper should pay no more than 70% of a property’s after repair value, minus the cost of repairs. On a $400,000 ARV with $60,000 of rehab, the maximum offer is $220,000.