Fix-and-Flip: $127K Profit on a Hamilton Bungalow Using Bridge Financing

Chen had been flipping houses in the Hamilton-Burlington corridor for four years, completing two to three projects per year. His reputation for closing quickly had earned him access to off-market deals—but those deals required fast capital deployment. Sellers of distressed properties want certainty of close, not financing contingencies.

The Crown Point bungalow came to him through a wholesaler. The property was a 1,200 SF three-bedroom with an unfinished basement on a 40-foot lot. The owner had passed away, and the estate wanted a clean, fast sale. Asking price: $385,000. The property needed everything: kitchen, bathrooms, flooring, windows, roof repairs, and basement finishing.

Chen's renovation estimate was $85,000. His comparable sales analysis suggested an after-repair value (ARV) of $620,000. The margin was there, but he needed to close in two weeks—too fast for conventional financing—and he needed a lender who understood renovation draws.

LendCity connected Chen with a bridge lender specializing in fix-and-flip financing. The loan was structured as a 12-month interest-only bridge at 10.5% with 2 points (lender fee). The lender advanced 80% of the purchase price ($308,000) plus held back $68,000 for renovations (80% of the $85,000 budget).

Chen contributed $77,000 in cash for the down payment and $17,000 for the renovation shortfall—total capital deployed: $94,000. Closing happened in 11 days, beating the estate's timeline by three days. The speed of close was a competitive advantage that won the deal over two other offers that were contingent on conventional financing.

Renovation was completed in 4.5 months. Chen's crew handled the work: new kitchen with quartz countertops and stainless appliances, two fully renovated bathrooms, LVP flooring throughout, new windows on the main floor, roof repairs, and a finished basement adding a fourth bedroom and recreation room. Total renovation cost came in at $82,000—$3,000 under budget.

The property was listed at $629,000 and sold in 3 weeks for $615,000 with no conditions. From acquisition to sale: 7.5 months.

Fix-and-flip bridge loans are purpose-built for renovation projects. They combine acquisition financing with renovation draws in a single loan product, eliminating the need for separate construction financing. The interest-only structure keeps carrying costs low during the renovation period.

The renovation holdback is released in stages as work is completed and inspected. For Chen's project, draws were released at 33%, 66%, and 100% completion milestones. This protects the lender while ensuring the flipper has access to renovation capital throughout the project.

The cost of bridge financing—10.5% rate plus 2 points—adds approximately $26,200 to the project over 7.5 months. But the alternative (paying cash for the entire project) would have required $467,000 in capital instead of $94,000. Bridge financing allowed Chen to deploy less capital per project and run multiple flips simultaneously.

Chen's total project cost was $488,000 ($385K purchase + $82K renovation + $21K carrying and closing costs). The property sold for $615,000, leaving $127,000 in net profit before taxes. On $94,000 in deployed capital, that's a 68% return in 7.5 months—or 109% annualized. *(Results specific to this transaction; individual outcomes will vary.)*

The bridge loan was the enabler. Without it, Chen would have needed $467,000 in cash to complete the project. With the bridge, he deployed just $94,000 and recycled the remaining capital into a concurrent flip in Burlington—effectively running two projects simultaneously with the capital that would have funded one cash deal.

Chen has since completed two more Hamilton flips using the same bridge lender and LendCity financing structure. His repeat borrower status has earned him slightly better terms on subsequent deals (reduced to 1.5 points), improving his margins further.