Financing Flipping a Home

[Dezmond Rozek]

I am a new member and found the site through the book How To Invest In Real Estate Ultimate Beginner's Guide. I am a licensed Realtor in Akron OH with Keller Williams looking to buy my first investment property. I am looking in the range of 50k-120k properties to flip for a 25k+ profit. When I do find a deal I am curious what type of financing experienced investors would use in my situation. I have about 10k of my own money available, but I have family I could possibly borrow from. How do I go about paying people to help with the rehab? How do I pay for supplies needed? 

Thank you!

Dezmond Rozek

[Brittany Minocchi]

Hey Dezmond! 

If you're planning to flip and not hold, you'd probably want to look at a short-term I/O type loan. These are usually 12-18 month terms with a balloon. It would depend on how long you think the renovations would take to make sure that timeframe isn't an issue. You'll want to pay attention to the minimum loan amounts with these programs -- $50k purchase price will be tricky to finance. I could go as low as $100k assuming 75% LTV. As far as paying for labor, that's something that would need to be discussed with whoever you decide to use. For supplies, we usually use a credit card to earn points/cash back instead of paying cash.