Before you offer on a fix-and-flip, run the deal through ten questions. Score each 0-2. Below 14 → walk away. 14-17 → dig deeper. 18+ → green light. This is the same screen Kayak Capital uses on every loan we underwrite. We've funded over 1,000 of them since 2013.

Most fix-and-flip deals fail for predictable reasons. The borrower overpaid because they fell in love with the property. The rehab budget didn't include contingency. The comps weren't tight. The lender charged junk fees that ate the spread. After 12+ years of underwriting hard money loans, we've watched the same patterns play out hundreds of times — and they all show up in the first 10 minutes of conversation. This is the screen we use.

1

Are the comps tight and recent?

Are there at least 3 sold comps within 0.5 miles, in the last 90 days, at the resale price you're projecting?

2 points Yes, 5+ tight comps within the last 60 days.
1 point 2-3 comps but they're 6-12 months old or 0.5-1 mile away.
0 points "I'm pricing this off Zillow" or "no real comps but the area is appreciating."
Why it matters: Your exit is comps. If the comps don't exist, neither does the profit.
2

Is your ARV haircut realistic?

Did you trim 5-10% off your projected ARV to account for market shifts and your buyer using a lower-than-list offer?

2 points Yes. I'm underwriting to 90-95% of the most aggressive comp.
1 point I'm at 100% of the optimistic comps.
0 points "If Zillow says $600K, I'll get $620K."
Why it matters: Markets move. The buyer pool offers less than list. Build in a buffer.
3

Is the rehab budget built from a real scope of work?

Have you walked the property with a contractor (or done it yourself) and written line-item costs?

2 points Yes, full SOW with line items totaling $X.
1 point Rough per-sqft estimate based on similar past projects.
0 points "I think rehab will be around $50K."
Why it matters: The #1 reason flips fail is rehab overruns. A real SOW catches surprises before closing.
4

Did you add a contingency buffer?

Have you padded the rehab budget by 10-15% for surprises?

2 points Yes. My rehab budget includes a 10-15% contingency line.
1 point I padded it 5%.
0 points "I'll handle surprises as they come."
Why it matters: Every project has surprises. Plan for them or they'll plan your bankruptcy.
5

Does the deal pencil with conservative interest expense?

Did you calculate total interest assuming a 9-month hold, not the 4-month best case?

2 points Yes. I budgeted interest at 9 months.
1 point I assumed 6 months.
0 points "I'll be in and out in 3."
Why it matters: Permits, contractor delays, market shifts, and slow buyers all add weeks. Plan for them.
6

Are your holding costs in the budget?

Did you include property taxes, insurance, utilities, HOA, lawn care, and security for the full hold?

2 points Yes, all line-itemed in the holding costs.
1 point I added a rough $X/month placeholder.
0 points "I forgot about those."
Why it matters: $400-$800/month adds up fast. On a 6-month hold, you might be missing $3-5K.
7

Are your sale costs in the budget?

Did you include 5-6% agent commission, 1-2% closing costs, and any seller concessions you might offer?

2 points Yes. I budgeted 8% total for sale costs.
1 point I budgeted 5-6%.
0 points "I'll pay cash to the agent or sell it myself."
Why it matters: Selling a flipped property costs real money. Most rookies forget concessions.
8

Is your projected profit at least 15% of total investment?

Profit ÷ (purchase + rehab + carrying costs + sale costs) ≥ 15%?

2 points Yes, 18%+ projected return.
1 point 12-17% projected.
0 points Under 12%.
Why it matters: Below 15%, one surprise eats your profit. Below 10%, you're working for free.
9

Do you have the cash reserves for a worst case?

Can you cover 3 extra months of carrying costs + a $15K cost overrun without losing the deal?

2 points Yes, I have $25K+ in reserve specifically for this project.
1 point I have some reserve, would need to scramble.
0 points "If something goes wrong I'll figure it out."
Why it matters: Hard money lenders will fund the rehab via draws, but you need cash to cover holding costs and surprises.
10

Is the property in a market you understand?

Have you analyzed at least 5 deals in the same neighborhood, and do you know the typical buyer profile?

2 points Yes, I've underwritten or done deals in this neighborhood before.
1 point I've studied the neighborhood but never closed there.
0 points "It looked good on Zillow."
Why it matters: Local knowledge beats analytics. A Phoenix 85033 flip plays nothing like an 85254 flip — even though they're 15 miles apart.

Score your deal

18-20
Strong deal. Call Kayak at (480) 256-2274 to get funded.
14-17
Worth a deeper look. Fix the weak spots, then bring it to us.
8-13
Risky. Don't fund this unless you have specific reasons to override the screener.
Under 8
Walk away. The math isn't there.

Got a deal? Get it funded.

Same-day verbal approvals. 5-10 day close. Zero junk fees in Phoenix · 12% / 2 points in Charleston.

Get Funded → Or call Barry directly: (480) 256-2274

Kayak Capital is a direct hard money lender funding fix-and-flip, BRRRR, and construction loans across the Phoenix metro and the Charleston Lowcountry. Over 1,000 loans funded since 2013.

(480) 256-2274 · Barry@KayakCapital.com · KayakCapital.com/apply