Many folks have a real interest in flipping properties, this line of work is difficult yet it can also be very rewarding. The key to any flip is finding the right property in the right location for the right price. Funding your flip. With that being said, without funding the rest of the game is moot. The good news is there are many sources available for funding flips, the key is to do your research and find the best deal.
The number 1 reason folks don’t get involved in real estate is because they don’t believe they can have success without personal funds. The reality is there are many ways you can fund your flip without risking your own personal savings.
Funding your flip – valuable tips below:
- Find a partner – network with folks and sell them your business model and potential profits on flips. Your goal should be to find a partner that will finance deal and split profits with you 50/50. You do all the work and they sit back and rip the rewards – sell yourself
- Hard money lenders – this option can be expensive but if you are not going to hold onto property for long than this option could work. Expect to pay 15-20% interest in this scenario, it could be higher if you can’t put money down
- Private Investors – could be a friend, family member or business associate. The interest for these deals is anywhere between 5 to 12% in most cases.
- Home Equity Line of Credit – rates are very attractive but is not recommended for novice investors as risk is too high if things were to go south.
- Portfolio Line of Credit – If you have equity on other investment properties a bank may be willing to take a lien out on those properties in order to give you funding.
- Bank loans – may be best option for experienced with great credit scores, capital on hand and significant collateral
There are many different ways to fund your flips, you just not to be willing to put in the work to find the best option. If you have a great property and the numbers make sense you should be able to find funding for that deal.