The expandable tools disclosed herein may be used as an underreamer to enlarge a borehole, or may be used to stabilize a drilling system in a previously underreamed borehole or in a borehole that is being underreamed while drilling progresses. At least one moveable arm, which translates between a collapsed and expanded position in response to a differential pressure between the axial flowbore and the wellbore, includes a borehole-engaging surface with cutting elements and at least one nozzle to direct a fluid across the borehole-engaging surface. Flow directing elements on the external surface of the tool may be used to decrease the flow area in an annulus between the tool and the wellbore and directs fluid flow in the annulus toward the borehole-engaging surface.