Both products are short-term, both close faster than bank debt, and both are secured by a property that is about to change — which is why borrowers use the names interchangeably, and why lenders do not. Ask a fix and flip lender for a two-year lease-up loan, or ask a bridge lender to fund a rehab budget in draws, and the conversation stalls: the products are underwritten to different values, structured around different mechanics, and built to end in different ways.
This guide draws the distinction properly — sizing basis (ARV versus as-is value versus LTC), rates and terms, draw mechanics, exits — and finishes with the practical question: which one should you actually ask for.
What is the difference between a fix and flip loan and a bridge loan?
A fix and flip loan is renovation-purpose debt: sized against the property's after-repair value (ARV), funded partly through a draw schedule as rehab work completes, and exited by selling the finished property. A bridge loan is broader-purpose short-term debt sized on as-is value or total cost, used for acquisition, repositioning, or lease-up, and exited by refinance or sale.
The overlap is real — both are interest-only, asset-focused, and measured in months rather than decades — but the underwriting question differs at the root. A fix and flip lender is underwriting a future sale price: what will this property fetch once the renovation is done, and will it sell inside the term? A bridge lender is underwriting a property in transition: what is it worth today, what does the plan cost, and will the stabilized asset qualify for permanent debt? Everything else — leverage basis, draws, recourse, exit — follows from that split. For the full treatment of each product on its own, see our fix and flip loan guide and commercial bridge loan guide.
How are the two loans sized — ARV vs as-is value vs LTC?
Fix and flip loans size to the after-repair value: a common structure advances 80-90% of the purchase price plus 100% of the rehab budget, capped around 70-75% of ARV. Bridge loans size to what exists today: typically 65-75% of as-is value, or 65-80% of total project cost (LTC) on deals with a capex budget.
A fix and flip example, with arithmetic you can check:
- Purchase price $400,000, rehab budget $100,000, projected ARV $650,000.
- The lender advances 85% of the purchase price ($340,000) plus 100% of the rehab budget ($100,000) — a $440,000 total commitment.
- ARV cap check: 70% of the $650,000 ARV is $455,000, so the $440,000 loan fits under it.
- Total project cost is $500,000, so the loan covers 88% of cost. The borrower's cash at close is the $60,000 purchase gap plus closing costs.
A bridge example on the same logic:
- Purchase price $5,000,000 (also the as-is appraised value), planned capex $600,000, total cost $5,600,000.
- A bridge lender at 65% LTC commits $3,640,000 — which is 72.8% of the as-is value, inside the typical band.
Notice what each lender anchored to: the flip lender leaned on a value that does not exist yet, which is why the appraisal includes an as-completed opinion and why the rehab money is controlled through draws. The bridge lender leaned on today's value and the cost budget. The three leverage bases — LTV, LTC, and ARV — get a full comparison in our LTV vs LTC vs ARV guide.
How do rates, terms, and structure compare in 2026?
Fix and flip loans in 2026 typically price around 9.5-12.5% fixed, interest-only, with 1-2 points at origination and 6-18 month terms. Commercial bridge loans typically float over SOFR at spreads of roughly 300-500 basis points on institutional deals — or price around 8-11% fixed at smaller balances — with 12-36 month terms plus extension options.
| Fix and flip loan | Bridge loan | |
|---|---|---|
| Purpose | Buy, renovate, resell | Acquisition, reposition, lease-up, timing |
| Sizing basis | 80-90% of purchase + 100% of rehab, capped ~70-75% of ARV | 65-75% of as-is value, or 65-80% of total cost |
| Typical rate | ~9.5-12.5% fixed, interest-only | SOFR + ~300-500 bps floating; ~8-11% fixed at smaller balances |
| Term | 6-18 months | 12-36 months, extensions common |
| Draws | Rehab budget released through inspected draws | Usually none; capex or TI holdbacks on value-add deals |
| Recourse | Personal guaranty standard | Negotiable; non-recourse available on larger deals |
| Property focus | 1-4 unit residential investment, small multifamily | Multifamily and all commercial types |
| Exit | Sale of the renovated property | Refinance into permanent debt, or sale |
Two notes on the table. First, both products price off short-term benchmarks, so the floating side moves with the index — current SOFR and Treasury levels are on the rate dashboard. Second, the lender pools barely overlap: fix and flip lending is dominated by specialists — Kiavi and Park Place Finance are two of the best-known — who built origination platforms specifically around ARV underwriting and rehab draws, while bridge lending is a broader market of debt funds, mortgage REITs, banks, and private lenders. That breadth is why bridge terms vary more from lender to lender, and why the product rewards shopping the deal.
Describe the project once and see which loan programs fit it →
How do draws work on a fix and flip loan?
On a fix and flip loan, the purchase portion funds at closing and the rehab budget is held back, released in draws as work completes: the borrower finishes a stage, the lender inspects, and funds are reimbursed against the approved budget. Interest typically accrues only on the drawn balance, so the carrying cost steps up as the project progresses.
On the $440,000 example at 10.5% interest-only, that means about $2,975 a month on the initial $340,000 advance, stepping up to about $3,850 once the full $100,000 rehab budget is drawn. The mechanics matter more than borrowers expect: most flip lenders reimburse completed work rather than advancing cash for upcoming work, so the borrower floats each stage; inspection turnaround sets the pace of the project; and per-draw fees add up on a budget released in many small pieces. Our guide to construction draw schedules covers the mechanics — the draw schedule on a flip is a lighter version of the same machinery. Bridge loans, by contrast, usually have no draw process at all; where a value-add bridge deal includes a capex holdback, the release mechanics are looser and the budget is a component of the plan rather than the point of the loan.
What exit does each loan expect?
A fix and flip loan expects a sale: the underwriting question is whether the renovated property sells at or near ARV inside the loan term. A bridge loan expects a refinance or a sale: the underwriting question is whether the stabilized property will qualify for permanent debt large enough to retire the bridge.
That difference decides what can go wrong. The flip's risks are renovation overruns, a soft resale market, or an ARV that was optimistic — any of which can push the sale past maturity. The bridge's risk is the takeout: on the $3,640,000 example, if the property stabilizes at $520,000 of NOI, a permanent lender underwriting to a 1.25x DSCR at 7% on a 30-year amortization supports roughly $5.2 million of debt — the bridge refinances comfortably. But the takeout is sized on the NOI the plan actually delivers and the rates prevailing at exit, not the pro forma: if lease-up runs slow or rates rise, the supportable loan shrinks and the gap lands on the sponsor. Underwrite the exit before you sign the entry — for stabilized multifamily, the agency takeout path in bridge vs Fannie Mae financing is the standard playbook.
Which loan should you ask for?
Ask for a fix and flip loan when the plan is renovate-and-sell on a residential investment property and the budget needs draw funding sized to ARV. Ask for a bridge loan when the asset is commercial or the plan ends in a refinance — an acquisition ahead of stabilization, a repositioning, a lease-up, or a timing problem.
The edge cases follow the exit, not the label. A renovate-and-hold plan — buy, rehab, rent, refinance — is bridge-shaped even on a residential property, because the exit is a refinance rather than a sale. A heavy commercial rehab may be quoted as a bridge loan with a capex holdback rather than a flip loan, because the asset and the takeout are commercial. What matters is matching the sizing basis and the exit to your actual plan, then getting the request in front of the lender pool that underwrites that plan every week.
Matching the request to the right pool is the actual work. YieldStack is a commercial mortgage broker and marketplace, not a lender: a human deal team pre-screens the deal for bankability and packages it once, and the platform matches it against 5,000+ loan programs — bridge, renovation, and value-add structures among them — returning proposed terms side by side. The economics are outcome-based: $0 upfront and a 0.5-1% success fee only at close. For a single-family flip, the specialist channel is a natural fit; for commercial property or a residential portfolio, one submission puts the breadth of the bridge market into competition on your deal.
The bottom line
The two products answer different underwriting questions. A fix and flip loan lends against what a property will be worth renovated — ARV sizing, rehab draws, a sale exit — while a bridge loan lends against what exists today — as-is value or cost, minimal draw mechanics, a refinance or sale exit. Rates, terms, recourse, and lender pools all follow from that split. Name your plan honestly, pick the product whose exit matches it, and then make lenders compete for it: submit the project once and compare the terms that come back →