Buying a property to live in and buying a distressed property to renovate are two very different transactions. A traditional mortgage is generally designed for a completed property, while real estate investors need financing that can account for construction, changing property value, and a relatively short investment timeline. That is where fix and flip loans can become useful. Instead of treating the property as a finished home, this type of financing considers the investment as a project. The lender may evaluate the purchase price, planned improvements, renovation costs, and projected ARV. In many cases, the financing can combine the acquisition and rehabilitation costs rather than forcing the investor to arrange separate sources of capital. A specialized fix and flip lender can also structure renovation funds around project milestones. Rather than receiving the entire rehab budget at closing, funds may be released through draws as approved work is completed. This gives inves...