Choosing the Right Real Estate Loan for Your Project: Bridge, Flip, Construction, or Refinance?
The right financing structure can make or break a real estate deal. Whether you’re flipping a property, building from the ground up, or transitioning between loans, each product serves a unique purpose. Understanding when to use a bridge loan, fix and flip loan, construction loan, or refinance can help you move faster, protect profits, and scale your investment business efficiently.
At Barnett REI Finance, we help investors match the right loan to their strategy, so your financing works with your project, not against it.
Fix and Flip Loans: Short-Term, Value-Add Projects
Best for: Buying, renovating, and reselling a property within 6-12 months.
Fix and flip loans are designed for speed and flexibility. They finance both the purchase price and rehab budget in one loan, allowing investors to leverage capital efficiently.
When to Use:
The property needs cosmetic or structural improvements.
You plan to resell after renovation for a profit
You need quick closing and flexible draw schedules
Investor Tip: Keep your total project timeline under a year to maximize ROI.
Bridge Loans: For Fast Closings and Transitional Deals
Best for: Temporary financing between acquisitions, refinances, or dispositions.
Bridge loans are short-term, asset-based loans that “bridge” the gap between your current financing and your next move. They can fund quickly.
When to Use:
You’re waiting on permits, construction completion, or long-term financing.
You need to act fast to secure a deal.
You’re repositioning or stabilizing an asset before permanent financing.
Investor Tip: Bridge loans are ideal for cash-out refinances or when speed to close is your top priority.
Construction Loans: For Ground Up or Major Redevelopment
Best for: Building from scratch or taking on heavy renovations.
Construction loan are structured with draw schedules, releasing funds in stages as work is completed. They require detailed budgets and contractor plans.
When to Use:
You’re starting a new build or tear-down.
Rehab costs exceed 50% of total project value.
You have a contractor team and permits in place.
Investor Tip: Plan for potential weather or permit delays.
Refinancing: For Long-Term Holds or Capital Access
Best for: Converting short-term loans into stable, long-term financing.
After completing a fix and flip loan or construction project, refinancing can lower your interest rate, reduce monthly costs, or free up equity for your next deal.
When to Use:
You’ve completed renovations and increased property value.
You want to transition from short-term to long-term financing
You’re holding a property as a rental following a fix and flip loan.
Investor Tip: Use refinancing to recycle capital. Cash out your profits and redeploy them into your next flip or acquisition.
Every investor and project is different. Call Barnett REI Finance at 224-205-7266 to find which loan fits best for your scenario.