Glossary

Renovation financing terms, plainly defined

Plain-language definitions of the words that come up when you're financing a home renovation: pay-at-closing remodel, ARV, HELOC, equity-funded renovation, iBuyer, escrow, and more. Each term links to a deeper FLYP page where relevant.

Pay-at-closing remodel

A home renovation funded by a third party (such as FLYP) where the homeowner pays $0 during construction and the contractor is repaid from the home sale proceeds at closing.

Pay-at-closing remodels remove the cash-flow barrier that prevents most homeowners from improving a home before sale. The contractor carries the financing risk; if the home does not sell, the contractor — not the homeowner — absorbs the construction cost.

Related: Equity-funded remodel, Escrow

Equity-funded remodel

A renovation paid for using the equity built up in the home — either via HELOC, a pay-at-closing arrangement, or escrow proceeds at sale.

Related: HELOC (Home Equity Line of Credit), Pay-at-closing remodel

After-repair value (ARV)

The estimated market price a home will sell for after renovations are complete. Calculated from comparable sales of recently renovated homes in the same neighborhood.

ARV anchors the entire FLYP economics: renovation scope is sized so projected sale at ARV comfortably covers the existing mortgage, the renovation cost, and selling fees, with meaningful upside left for the homeowner.

As-is sale

Listing a home for sale in its current condition without making any repairs or improvements. As-is homes typically sell at a discount because buyers price in renovation risk.

iBuyer

An instant-buyer company (Opendoor, Offerpad, Knock, etc.) that purchases homes directly from sellers, typically at 8–15% below market value, then renovates and resells at retail. The seller misses out on the value added by the renovation.

Related: Cash buyer

Cash buyer

Any buyer purchasing a home without mortgage financing. In the renovation-financing context, often refers to investor and iBuyer firms paying below market for distressed or as-is properties.

Related: iBuyer

HELOC (Home Equity Line of Credit)

A revolving credit line secured by the home's equity. Requires a credit check, income verification, monthly payments, and is repaid by the homeowner regardless of whether the home sells.

HELOCs are useful for homeowners who plan to renovate and stay long-term. For homeowners planning to sell within 6–12 months, a pay-at-closing remodel removes the credit-and-payments burden entirely.

Related: Pay-at-closing remodel, Construction loan

Construction loan

A loan that funds a home build or major renovation in draws (installments). Requires appraisals, a draw schedule, and lender oversight. Best suited to ground-up builds or major additions, not typical pre-sale renovations.

Related: HELOC (Home Equity Line of Credit)

Personal loan

An unsecured installment loan, typically capped at $40K–$50K with 8–14% APR. Too small and too expensive for most meaningful pre-sale renovations.

Escrow

A neutral third-party account that holds money during a real estate transaction. At closing, the escrow company disburses funds — mortgage payoff, agent commissions, FLYP's renovation invoice, and the homeowner's net proceeds — from the buyer's payment.

Closing

The final step in a home sale: title transfers from seller to buyer, the buyer's funds are released from escrow, and all outstanding costs (mortgage, FLYP, commissions) are settled in one transaction.

Comp (comparable sale)

A recently sold home with similar size, condition, and location used to estimate the market value of another home. FLYP's ARV is anchored to renovated comps in the immediate area.

Renovation ROI

The ratio of sale-price lift to renovation cost. Cosmetic refreshes (paint, flooring, lighting) typically deliver the highest ROI; kitchens and primary baths next; pools and high-end finishes lowest.

Pre-sale renovation

Any home improvement work performed specifically to increase a home's sale price before listing. Goal is maximum return per dollar spent, not personal preference.

Mortgage payoff

The total amount needed to fully retire an existing mortgage on the closing date — principal balance plus any accrued interest. Paid first from sale proceeds at closing.

Selling costs

The fees and costs paid by the seller at closing: real estate agent commissions (typically 5–6% of sale price), excise tax (Washington State has a real estate excise tax), title insurance, and escrow fees. FLYP fits into this same closing-day settlement.

Scope of work

The agreed list of renovation tasks for a project — rooms touched, materials specified, finish levels, and timeline. Locked before construction begins so neither party encounters surprises.

General contractor (GC)

A licensed business that takes responsibility for executing a construction project, hiring trades, sequencing work, and meeting code. Green State Restoration is FLYP's in-house GC.

Double Win

FLYP's combined model where Green State Restoration also represents the homeowner as the listing agent (via partnership), so a single relationship handles renovation, listing, and sale.

FLYP & Sell

The primary FLYP path: zero-cost renovation paid for at closing, with the homeowner's existing real estate agent listing the home after renovation.

Stay & Renovate

FLYP's path for homeowners who want to renovate but not sell. Project management by FLYP, financing via the homeowner's HELOC. Still $0 down to start.

Veteran-owned

Green State Restoration, FLYP's operating company, is owned and operated by a U.S. military veteran. The designation reflects ownership status; it does not modify pricing or scope.