Rehab Loans in Los Angeles, CA

Light rehabilitation projects involve cosmetic improvements that enhance property appeal without major construction. Typical scope includes interior and exterior painting, flooring replacement (carpet, hardwood, tile), lighting and plumbing fixture updates, appliance replacement, landscaping improvements, and minor repairs. These projects can often be completed in 30-60 days with minimal contractor coordination and limited permitting requirements. Our light rehab loans provide acquisition financing plus renovation capital up to 80% of total project cost. Draw schedules are simple, often just 2-3 disbursements based on project milestones. Interest reserves cover carrying costs during the brief renovation period. Light rehab is ideal for rental property improvements that increase rents, quick flips in competitive markets, and preparing properties for sale. The fast timeline and lower risk profile often qualify for better rates and terms compared to major renovation financing.

Heavy renovation projects transform properties through structural modifications, complete gut renovations, additions, or systemic upgrades. These projects may include moving walls, room additions, foundation work, electrical and plumbing replacement, HVAC installation, roof replacement, and complete kitchen and bathroom rebuilds. Heavy renovations require extensive permitting, professional contractor management, 3-6 month timelines, and significant capital. Our heavy renovation loans provide up to 75% of total project cost with detailed draw schedules tied to construction milestones and inspections. We structure interest reserves covering extended renovation periods and include contingency allowances for unexpected conditions. These loans are ideal for fix-and-flip investors targeting major value-add opportunities, multi-family repositioning projects, and converting outdated properties to modern standards. The transformation potential justifies the complexity and extended timelines of heavy renovation projects.

Properties requiring structural repairs, foundation issues, seismic retrofitting, major framing repairs, roof structure replacement, present unique financing challenges. Traditional lenders often won't touch these properties until repairs are complete, creating a catch-22 for investors. Our structural repair loans finance acquisition of properties with known structural issues plus the capital to complete necessary repairs. We work with qualified structural engineers and contractors to scope repairs, establish realistic budgets, and monitor work completion. These loans require careful due diligence including structural inspections, engineering reports, and contractor qualification verification. Loan structures include appropriate contingencies for unknown conditions and extended timelines that structural work may require. Successfully completed structural repairs often unlock significant value, as these properties trade at substantial discounts to repaired comparables.

Cosmetic improvement financing serves investors making surface-level enhancements that dramatically improve property appearance and marketability without major construction. These projects focus on aesthetic updates, fresh paint in modern colors, new flooring, updated lighting, modern hardware, curb appeal landscaping, and staging for sale. While individual improvements are relatively minor, the cumulative impact can transform dated properties into market-ready homes commanding premium prices. Our cosmetic improvement loans feature streamlined processing with minimal documentation, fast funding for quick-turn projects, and structures optimized for 2-4 week renovation timelines. These loans work well for rental property refresh between tenants, preparing inherited or distressed properties for market, and quick flips where the previous owner deferred basic maintenance. The high velocity of cosmetic projects, acquire, improve, sell/refinance within 60-90 days, creates compounding returns for active investors.

Light rehab financing covers cosmetic improvements, paint, flooring, fixtures, landscaping, that can be completed in 30-60 days with minimal permitting. These loans offer higher leverage (up to 80% of project cost) and streamlined processing. Heavy renovation financing covers structural work, gut renovations, additions, and systemic replacements requiring 3-6+ months and extensive permitting. Heavy rehab loans typically max at 75% of project cost with more detailed underwriting, milestone-based draws, and extended terms. The classification depends on project scope, timeline, and permit requirements rather than just dollar amounts.

Rehab draws release construction funds as work is completed and verified. You submit draw requests with documentation of completed work, contractor invoices, and lien releases. We send inspectors to verify work completion before approving draws. Approved draws are typically funded within 24-48 hours. Light rehab projects may have 2-3 draws total, while heavy renovations may have monthly draws or milestone-based releases tied to specific construction phases. You pay interest only on drawn amounts, not the total renovation budget, reducing carrying costs during construction.

Yes, we regularly finance properties requiring structural repairs including foundation work, seismic retrofitting, framing repairs, and roof structure replacement. These loans require thorough pre-purchase inspection by qualified structural engineers, detailed repair scopes and budgets from licensed contractors, and appropriate contingency reserves. We verify contractor qualifications for structural work and monitor repairs through draw administration. Structural repair projects often unlock significant value, as properties with these issues trade at substantial discounts that exceed repair costs when properly managed.

We typically finance 75-80% of total project cost (purchase price plus renovation budget) for rehab projects. Light rehab projects with experienced investors may qualify for up to 80-85% of project cost. Heavy renovations or projects with inexperienced borrowers may be limited to 70-75%. The specific percentage depends on project scope, location, your renovation experience, and exit strategy strength. Your equity covers the remaining project costs plus any cost overruns beyond contingency reserves.

Rehab loan terms range from 6-12 months for most projects, with extensions available if renovations extend beyond initial timelines. Light rehab projects with quick turnaround strategies may have 6-month terms, while heavy renovations or projects in jurisdictions with slow permitting may have 12-18 month terms. Terms include both renovation and marketing periods for flip projects. We work with you to establish realistic timelines based on project scope, permit processing estimates, and market conditions. Extension options are available if projects take longer than anticipated due to factors beyond your control.