Purchase and flip loan
Hi all! I’ve come across an off market deal that I would like to buy and flip….
I can acquire the property for $1,050,000 which will require approx. $50,000 in rehab, and current Comps are 1.5-1.6. I feel that I can have it ready and on the market in approx. 2-3 months. Now, here lies the question. I currently own my existing home which I purchased 2 years ago as primary residence. I'm pre-qualified for another conventional loan but it's stated as another primary residence (as in I would be renting out my current home and moving into the new one). Am I ok to get my loan in this fashion and just pay it off within 3-6 months after the flip (there's no pre-pay penalty)… it is this a bad idea. Rates are bad for investment properties and my income and credit is too strong for me to ever consider hard money… my current approval is conventional 20% down, APR 5.95 @30 years, ZERO Points and only $850 origination fee. Thoughts?