Fix and flip financing is more expensive than conventional mortgage financing — reflecting the short-term, high-flexibility nature of the product. Here is a realistic breakdown of what California investors should expect.

Interest Rates

Fix and flip rates in California typically range from 9% to 12%, depending on:

• Borrower experience and track record
• Loan-to-ARV and loan-to-cost ratios
• Property type and location
• Loan amount
• Lender and current market conditions

Points (Origination)

Origination fees typically range from 1.5 to 3 points. On a $400,000 fix and flip loan, 2 points = $8,000. Points are paid at closing and reduce the effective return on the deal.

Other Costs

• Underwriting and processing fees: $500–$1,500
• Draw inspection fees: $100–$300 per draw inspection
• Appraisal: $500–$900 for standard properties
• Extension fees if the term is extended

The Real Cost in Context

On a 9-month fix and flip project with a $400,000 loan at 10% interest-only, total interest = $30,000. Add 2 points ($8,000) and you’re looking at $38,000 in financing costs. If the deal yields a $100,000 profit, that leaves $62,000 net — still a strong return. The higher rate is the cost of access, speed, and flexibility.