I'm a newer member to BP from the Philadelphia area specifically Montgomery County looking to get into flipping houses in Montgomery county. My dad had the old Carlton Sheets books, video tapes and cassettes. I went through those books and read Flip this house and Millionaire real estate investors (great books). I've been working in the corporate world for about 10 years and looking to get into real estate investing part time. I've been searching deals on trulia, received MLS listings from our realtor that helped us find our home, and searching foreclosure properties at the county courthouse. I'm unsure if I should use cash I have saved up to put money down and finance the rest of the property and rehab or take out a HEL for down payment and rehab? Any advice on starting out with financing or finding potential properties would be helpful. I have listened to a few of the podcast and they have been amazing. Also my other question is do I need all cash for a foreclosure or can I finance some of it? I guess it depends on the county. Thanks and happy to be here.
Welcome @Steve Francis
I work in good old Conshy, if you're ever around and want to get coffee or lunch, let me know. I'm also currently working on a flip in Philadelphia, where I live, so you're welcome to come see that hot mess as well!
Conshy is hot so any decent deals go quickly and I doubt you're finding anything flippable on the MLS anyway. Plymouth Meeting and a few other areas seemed to have a bit more inventory from what I recall but again, slim pickings on the MLS. Not sure I'd advise going to auctions for your first property, lots of unknowns. You could always market for your own properties. Also, tell everybody what you do and ask if they know of anyone that may be interested in selling.
I'd lean towards a mortgage with 20% down and cash for the rehab if you can swing it with a reserve for holding costs and overages. However that looks, maybe an equity LOC instead of a straight loan if you don't need the whole amount.
Thanks for getting back to me and the suggestions. I may take you up on your offer. I'll let you know. Yeah I think Conshy is probably tapped out so I'm looking at other surrounding areas. I'm thinking put money down and possibly use an equity LOC for the rehab. As far as foreclosures and auctions I may just go check one out at the courthouse. Any advice or recommendations on contractors? Is Angie's list a good source? I may do some work myself but most of it I'll bring in help. Thanks again!
@Steve Francis I'm actually looking at montco for some properties as well (particularly norristown becuase it's cheap, and they cashflow, definitely not for appreciation!).
It definitely depends on your risk tolerance, but if I were you, I would use HELOC first for the 20% down, and get a mortgage if you could, and keep the cash as a reserve, but that's just me.
I have been in touch with a few contractors, but haven't worked with them enough to put my name behind them (not that my name means anything yet!) but hopefully in the next couple weeks/months I'll feel comfortable referring one or two!
@Steve Francis Welcome to BP. This is a great site to learn from! I look forward to seeing you around!
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