Updated
Scenario assumptions
| Location | Bridgeport, Chicago, Illinois |
|---|---|
| Property type | Illustrative Bridgeport brick worker's cottage (single-family, 3 bed after rehab) |
| Loan type | Modeled hard money fix-and-flip loan |
| Loan amount | $355,500 modeled (90% LTC on purchase plus rehab) |
| Close time | 9 business days modeled |
What this Bridgeport flip example tests
This is an illustrative scenario with assumed numbers, not a completed Jaken Finance Group loan. Prices, rents, rates, and timelines are modeling inputs. They are meant to show how a Bridgeport flip should be underwritten before you commit earnest money.
Bridgeport sits between Chinatown and McKinley Park on Chicago’s South Side. Its brick worker’s cottages and small bungalows sell to first-time buyers, city workers, and young families who want a short commute downtown. That buyer pool is price-sensitive. A renovated cottage that lists $30,000 too high can sit for months.
The modeled investor buys a dated single-family brick cottage, adds a half bath, and replaces the kitchen and systems. The loan is a hard money fix-and-flip loan with a renovation holdback. The exit is a retail sale.
The big question here is not “what is the profit?” It is “how much does profit fall if the sale is slower or lower than planned?” For current terms, see our Chicago fix and flip loans and the Bridgeport hard money page.
Purchase and renovation budget
| Project item | Assumed amount |
|---|---|
| Purchase price | $285,000 |
| Renovation budget | $110,000 |
| Total project cost | $395,000 |
| Assumed resale value (ARV) | $525,000 |
| Rehab line | Assumed cost |
|---|---|
| Kitchen replacement | $28,000 |
| Full bath remodel plus new half bath | $24,000 |
| Electrical update | $14,000 |
| Furnace and central air | $11,000 |
| Windows | $9,000 |
| Flooring and paint | $12,000 |
| Roof repair and tuckpointing | $6,000 |
| Contingency | $6,000 |
| Total | $110,000 |
A 5.5% contingency is thin for a century-old brick cottage. Many Bridgeport sponsors carry 10% once they open walls. The model keeps it low on purpose to show how quickly the margin compresses.
How the loan was sized
Jaken Finance Group’s leverage policy funds the lower of eligible loan-to-cost (LTC) and 75% of after-repair value.
- 90% LTC on $395,000 = $355,500
- 75% of $525,000 ARV = $393,750
The lower number, $355,500, sets the loan. It breaks into a $245,500 purchase advance (about 86% of the price) and a $110,000 rehab holdback.
| Loan term | Modeled input |
|---|---|
| Loan amount | $355,500 |
| Interest rate | 11.25% interest-only |
| Origination | 2 points ($7,110) |
| Term | 12 months |
| Draws | Four inspection-based releases |
The 11.25% rate falls inside Jaken Finance Group’s published range of 8.99%–13.5% for fix-and-flip loans. Experience, credit, and the scope of work drive where a real quote lands.
Cash needed at closing
| Closing item | Modeled amount |
|---|---|
| Down payment ($285,000 − $245,500) | $39,500 |
| Origination points | $7,110 |
| Chicago buyer-side transfer tax (0.75%) | $2,140 |
| Title, legal, and closing fees | $3,500 |
| Cash to close | $52,250 |
Base-case carrying costs (six months)
Rehab runs four months. Listing, contract, and closing take two more. Interest only accrues on funds actually advanced.
| Carry item | Calculation | Amount |
|---|---|---|
| Purchase advance interest | $245,500 × 11.25% ÷ 12 × 6 | $13,809.38 |
| Rehab interest, months 1–4 | ~$55,000 average drawn | $2,062.50 |
| Rehab interest, months 5–6 | $110,000 fully drawn | $2,062.50 |
| Taxes, insurance, utilities | $750 × 6 | $4,500 |
| Total carry | $22,434.38 |
Draw schedule and inspection milestones
The $110,000 holdback is released in four draws. Each draw pays for work already done, after an inspector confirms it.
| Draw | What the inspector verifies | Release | Total released |
|---|---|---|---|
| 1 | Demolition done, windows in, roof repair and tuckpointing complete | $26,000 | $26,000 |
| 2 | Rough electrical, plumbing, and HVAC passed city rough inspections | $30,000 | $56,000 |
| 3 | Drywall hung, cabinets set, bath tile and fixtures installed | $34,000 | $90,000 |
| 4 | Flooring, paint, appliances, final inspections, and punch list | $20,000 | $110,000 |
Because draws reimburse finished work, someone fronts the cost of each stage. That is usually the contractor, the investor, or both. The investor kept about $34,000 of working cash, equal to the largest draw, on top of cash to close.
A failed inspection holds the draw until the work is fixed. Early in the project, each week of delay costs about $530 in interest on the purchase advance. Once the loan is fully drawn, it costs about $770 a week.
Deal timeline
| Week | Milestone |
|---|---|
| 1 | Contract signed; contractor bid and scope walk |
| 2 | Loan closes in 9 business days (modeled) |
| 3–4 | Permit filing and demolition |
| 5–10 | Rough electrical, HVAC, and plumbing; first two draws |
| 11–18 | Kitchen, baths, flooring, and paint; final two draws |
| 19–20 | Punch list, photos, and listing |
| 21–26 | Offer, buyer financing, and sale closing |
Base-case sale math
| Sale line | Amount |
|---|---|
| Sale price | $525,000 |
| Commission (5%) | −$26,250 |
| Seller transfer taxes (state, county, and CTA portion) | −$2,362.50 |
| Title and attorney | −$2,500 |
| Buyer closing-cost credit | −$5,000 |
| Net sale proceeds | $488,887.50 |
| Loan payoff | −$355,500 |
| Cash back to investor | $133,387.50 |
Total cash invested is $74,684.38: $52,250 at closing plus $22,434.38 of carry. Subtract that from the cash back and the modeled profit is about $58,703. That is roughly an 11% margin on the sale price.
The stress test that decided the deal
A single profit figure hides risk. The investor modeled four outcomes before signing the contract.
| Scenario | Sale price | Months held | Total carry | Modeled profit |
|---|---|---|---|---|
| Base case | $525,000 | 6 | $22,434 | $58,703 |
| Slow sale | $525,000 | 9 | $34,683 | $46,455 |
| Slow and lower | $495,000 | 9 | $34,683 | $18,090 |
| Stall | $480,000 | 12 | $46,931 | −$8,341 |
Two lessons stand out. First, three extra months cost about $12,250 in carry. Second, a $30,000 price cut costs far more than time does, because commission and transfer taxes fall only slightly.
The investor accepted the deal because the “slow and lower” case still made money. The stall case was the reason for a written plan: cut the list price by $10,000 at day 30 without offers, and again at day 45.
90% vs 80% loan-to-cost
More leverage is not free, and less leverage is not always safer. The investor compared the modeled loan with a smaller one at the same rate and points.
| Line | 90% LTC (modeled) | 80% LTC |
|---|---|---|
| Loan amount | $355,500 | $316,000 |
| Purchase advance | $245,500 | $206,000 |
| Cash to close | $52,250 | $90,960 |
| Six-month carry | $22,434 | $20,213 |
| Total cash invested | $74,684 | $111,173 |
| Base-case profit | $58,703 | $61,715 |
| Return on cash invested | 79% | 56% |
| 12-month stall at $480,000 | −$8,341 | −$3,108 |
The 80% loan puts about $36,500 more cash into the deal. In return, it adds about $3,000 of base-case profit and cuts the stall-case loss by about $5,200. The investor kept 90% and used the saved cash as a reserve for the stall case. For an investor with only one project, that trade makes sense. For one running three flips at once, the smaller loan can be the better fit.
Run your own version in the fix and flip calculator.
Three things the sponsor would change
- Raise the contingency to 10%. About $10,000 on this scope, funded by trimming finish upgrades rather than adding cash.
- File permits during the contract period. Plan review for the new half bath can run while the loan closes.
- Get a listing agent’s price opinion before the offer. Their view of the top of the Bridgeport cottage market is a better ARV check than the investor’s own spreadsheet.
Bridgeport-specific risks
- Buyer financing. Many Bridgeport buyers use FHA or conventional loans with small down payments. Their appraisers will scrutinize unpermitted work. Pull permits for the half bath and electrical.
- Permit path. Chicago’s Express Permit Program covers limited scopes. Adding a bathroom or moving walls can require standard plan review, which adds weeks.
- Water service. Older Chicago homes may have lead service lines. Ask your plumber whether your scope touches the water service and price it before closing. Our lead service line budgeting article walks through it.
- Comps. Use renovated single-family sales in Bridgeport, not two-flats or new construction. A new build three blocks away is not a fair comp for a cottage.
When holding beats selling
If the sale stalls, a rental exit can protect capital. A renovated three-bed Bridgeport cottage might rent near $2,600 a month. That makes a Bridgeport DSCR loan a realistic fallback. The investor should confirm the refinance math before closing, not after the listing goes stale.
For a two-flat version of that hold strategy, see the Bridgeport two-flat BRRRR example. It shows why rental coverage can fall short even when the purchase looks cheap.
Before you copy this structure
Model at least four exit scenarios, as shown above. Get written contractor bids with line items that match your draw schedule. Set your price-reduction triggers before you list, not after.
Start with the Chicago hard money lenders guide for program details. For neighborhood comparisons, read Chicago neighborhoods for flipping.
Ready to test your own Bridgeport flip? Submit your scenario or call (833) 264-7776.
Related
- Fix and flip loans Chicago
- DSCR loans Chicago
- Chicago fix and flip permits guide
- Chicago BRRRR strategy guide
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