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You just stumbled into the idea of flipping houses.
Maybe because of the pandemic, you’re looking for other ways to make money and bring in income to your family.
House flipping is definitely a good strategy to bring in income into your family.
Now there are 2 different types of house flipping.
- Individuals searching for wholesale deals to assign to investors that will actually do the work.
- Investors that will actually acquire property, meaning they will actually buy the property, fix up the property and then list it back on the market with a licensed agent for profit.
So either one of those two are valid ways of making money or valid methods of real estate investing.
There are, probably about another, seven types of real estate investing that you will learn inside of this book REAL ESTATE MONEY SECRETS.
But those are the two methods for flipping houses.
Again, you’re just finding the deals, locking up the property under contract, and then flipping your equitable rights in the contract to another individual that will actually exercise the right to purchase the property at a predetermined price.
This is a price that makes it make sense for you to make money.
So it’s always a reversed engineer math, from the property’s worth after repair aka the After Repair Value.
Then you need to make sure that you buy the property significantly lower than the after repair value,l after being adjusted for how much it’s gonna cost to repair the property.
You may also want to include some other costs that come with this type of business such as…
PREVIOUS POST: TAXES PAID When Flipping Houses
- Money costs
- Holding costs
- Closing costs
Those are the three main types of cost that comes with doing these deals.
The Money Costs is essentially what we’re talking about when you ask…
“Where do you get money for flipping houses?”
The good news is that the one asset class that the banks are willing to lend money towards is real estate.
- The banks are not willing to lend you money to buy stocks from the stock market.
- They’re not willing to lend you money to buy bonds.
- They’re not willing to lend you money to buy cryptocurrency.
- They’re not willing to lend you money to buy forex exchange deals.
But the banks, all day long in most developed nations around the world are willing to lend you money to buy real estate.
Because they know that real estate is a guaranteed asset that retains and increases in value historically.
No matter what happens to the economy, real estate retains its value because people will always need shelter over their head.
People need a roof over their head and that’s why.
So with that being said, where do you get money for flipping houses?
The banks are willing to lend you money to flip houses as long as on paper, it looks like a profitable deal.
Now, how would they verify?How would they vet that it’s a good deal?
Property value is public records in developed nations like the United States. There are more elaborate ways to find out what the property is worth.
Here is what we do here…. check out the Deal Estimator at www.DealEstimator.com it’s a free estimator and real estate analysis tool.
Inside the 11 days challenge, we get into a little bit more of elaborate details on how to evaluate the value of a property.
We look at comparables a.k.a comps. These are essentially properties that were sold in the area within the last six months or one year.
…Depending on the standard and the condition of the market.
In uncertain markets, I think it is very important to be looking at just six months and not one year.
But it’s just a numbers game. Once you know what the property is worth, then you now know what the property is worth after repair,
And then you can multiply that number by 65%.
If you’re the one that’s actually gonna do the fixing of the property, then you can multiply by up to 70%.
And then you can adjust that number for what it would cost to repair the property. (Estimated Cost of Repair).
The product is called the Maximum Allowable Offer.
So to answer the question, where do you get money from?
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The banks are open to lending you money, especially if they know they’re gonna make money from it. So remember, money costs?
- There’s money cost
- There’s holding costs
- There’s closing costs
That money cost is the cost of using the bank’s money. That’s basically the profit that the bank makes from doing this kind of deals in partnership with you and lending you the money to do the deals.
How much of the money are they willing to lend to you? It depends on what program you plug into.
But the good news is that the banks are always willing to give you money if the deal makes sense.
If you have terrible credits or band credit ratings, this is still a money making venture.
You can partner with people that have good credit, and you can get the deal done.
What about down payment or stuff like that?
Downpayment is involved if you want to fix and flip the property by yourself.
But even at that, you can also structure that into the deal as part of the money deal. Somebody else will give you the money.
You can reward and pay them 8% and even up to 12% annualized interest rate. As long as the deal makes sense, then you’ll be able to make money.
So where do you get money?
Other people’s money (OPM).
Where can I get money to flip houses?
You can get money to flip houses from real estate investors, banks, hard money lenders, family and friends.
Is Flipping houses still profitable 2021?
If you have money to out-market the competition, flipping houses is very much profitable even in 2021.
Can you get rich off flipping houses?
Yes you can get rich off flipping houses but only if you understand that it is a business list other businesses that requires marketing and processes.