Let’s be honest. Flipping Houses costs a hefty sum of money. Use these 4 top financing options for Flipping Houses according to your needs for an easy way to obtain every single investment property you flip.
Investing in real estate gives you several methods to choose from… you can rent, rent-to-own, wholesale, flip etc. Usually, people who look to flip property, try to buy one, fix it up and renovate it to sell it at a much higher price giving them a generous profit. If you are one of them, here are 4 top financing options for flipping houses…
Flipping Finance Option #1
The most basic and traditional way is to get a bank loan from a mortgage loaning company or the bank itself. This is done exactly like any other residential mortgage loan: You set a down payment and then use your credit score as an advantage to borrow the rest. However, the only difference is that since you’ll sell the house to a buyer, you’ll get the mortgage back much sooner.
The only major drawback is the limit to the amount of properties you can flip at one time. This is because the bank would usually not lend you as many mortgages in your name until you repay the previous. However, a personal tip would be to loan them in someone else’s name – someone close to you like your wife who knows that it’ll be repaid.
Flipping Finance Option #2
Yet again, you could just find other investors to pair up with and pay of the entire investment easily. If 4 people pay up an investment of $80000 together, then each one of you only has to pay $20000!
A bit of complications do occur when it comes to how much of a percentage each partner will put in for the carrying forward charges and the repair costs etc. This will also lead to a discussion about who will earn how much at the end. With the above example of 4 partners, you could divide it in 25% markers for each one. Though sometimes one of the investors can turn out to be generous and does the entire renovation work himself!
If you’d like to flip some properties and perhaps want to partner with other investors, why not get in touch with us at (561) 370-8335 and we might be able to give you some suggestions or even make some introductions.
Flipping Finance Option #3
Another smart strategy is to invest in property using your IRA or 401(k). However, you should know about the certain restrictions you’ll face — it will be smarter in this case, to ask for help through a professional.
But still, the tax advantages in this method are limitless. Therefore, I highly suggest you use this option, if of course, you have the money available.
Flipping Finance Option #4
Another extremely powerful method is Seller Financing. With this method, you don’t even need the bank for the loans. Basically, the buyer is now your new bank! You can skip getting a loan here, because now you can just pay the seller a specific mortgage for a specific amount of time while gaining ownership right in the beginning! This cash flow is also attractive to sellers and many agree to this concept gladly.
If you’re looking to carry out investment in this sector, then use the methods above for a guaranteed profit in the process of flipping houses. These options will surely lead you through all the way.
You can talk to us at Home Solutions FLA about how to acquire more properties to flip or to help you figure out how to invest with your IRA or 401(k). Just click here to enter your information or give us a call at (561) 370-8335.