Fix & Flip Bridge Rates Dropped 65 bps YoY — Non-QM Is Now 15% of the Mortgage Market

The Number

Average fix-and-flip bridge loan rates fell from 11.1% in September 2024 to 10.43% in September 2025 — a 65 basis point year-over-year improvement. The trend has continued through Q1 2026, with strong-profile borrowers (3+ completed flips, 700+ FICO, 75% ARLTV) routinely pricing in the 9.25–9.75% range on 12-month interest-only bridge executions.

For the borrower moving 4–6 deals per year, that 65 bps improvement compounds into meaningful savings. On a $350K loan at 12 months IO, you are keeping an extra $2,275 per project in net profit.

Why Rates Are Compressing

Three structural shifts are at work:

1. Non-QM Has Gone Mainstream

Non-QM originations are projected to exceed 15% of total mortgage volume by end of 2026, up from roughly 8–9% three years ago. That is a massive structural shift driven by:

10.5 million self-employed Americans whose income is not W-2-shaped

Growth of the investor class (single-family rental and fix-and-flip buyers)

Agency guidelines that do not match modern underwriting realities

The March 2026 National Mortgage Professional Town Hall concluded that non-QM has evolved into a primary lending channel for top producers — no longer a fallback product for deals that cannot fit agency.

2. More Capital Competing for the Same Paper

A year ago, roughly 12 active private credit funds were competing aggressively for fix-and-flip paper at the wholesale level. Today that number is closer to 20. More bidders for the same deals means tighter spreads.

You see this directly in the lender stack: identical deals now spread 50–100 bps across the quote stack where they used to spread 150–200 bps. The bottom of the range is coming in.

3. Experienced Borrower Premium Shrinking

Historically, a first-time flipper and a 10-flip veteran could see 200+ bps difference on otherwise identical deals. That gap is now closer to 100–125 bps. Lenders are competing more aggressively for the middle of the experience spectrum — 3 to 9 completed projects — which is exactly where most repeat operators sit.

What This Means For Borrowers

If you are running fix-and-flip deals in 2026:

Shop the full stack, not just your usual lender. The 50–100 bps dispersion means even sticky borrower relationships are costing you money if you are not pricing against alternatives every deal.

Experience counts, but less than it used to. If you are between 3 and 9 completed projects, you are in the sweet spot where multiple lenders will compete hard for your business.

Watch origination points. Most fix-and-flip lenders charge 1.5–3.0 origination points. The lender with the best rate is not always the lender with the best all-in cost once you factor in points, exit fees, and draw processing fees. We model all-in effective yield, not coupon rate.

Where We See Fix-and-Flip Pricing Going

Our view through Q3 2026:

Rates stable to slightly lower — another 25–50 bps of compression is plausible if inflation stays contained and the Fed holds the line on cuts

Leverage unchanged — 90% LTC with 100% rehab remains the ceiling on strong borrower profiles, with 85% LTC more common on 1–2 experience band files

Speed becomes the differentiator — with pricing compressed, lenders are competing on time to fund (now routinely 10–14 days on clean files) rather than rate alone

If you are sizing a flip right now and want to see the live quote stack on your file, send us the deal. We will run it through the active non-QM lenders simultaneously and show you what the best execution actually looks like — all-in cost, not just the coupon.