Specialist · I give advice - [email protected] - I focus on states where investing is profitable, reasonably safe & secure · Member since 2026 · 203 posts · 68 votes
What is your plan for financing your fix and flips or buying rentals? That seems to be what holds most people back.
I'm aware of three options - our business really took off when to changed to the first option There are variations to all of these but in 30 years of flipping what I generally see are:
Option 1. Taking Over someone's loan -
a. Generally will provide full financing on the loan b. 8.5% down. c. $25,000 down. d. 4% - 5% interest e. Can buy "off market" f. Credit not at all important g. No real estate agent fees h. So a $300,000 house i. Is $25,000 down j. $1,300 to $1,475 a month payments k. Then taxes, utilities l. You bring in the rehab money m. Tend to be faster to very quick n. Probably need to be trained on how to put it together
You are in control
You can use all three .
Option 2. Using a bank -
a. Bank qualifying financing b. 20% down. c. 7% interest d. use MLS e. Normal bank loan (2% 0r $4,000) f. Normal real estate agent fees ($20,000) g. Normal purchase routine h. So a $300,000 house i. Is $60,000 down j. $2,000 a month payments k. Then taxes, utilities l. You bring in the rehab money m. Tend to be slow to decide n. Must qualify
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Option 3. Hard Money -
a. Generally will provide 70% financing on the lesser of value of finished product (ARV) or of purchase price whichever is less b. 30% down. c. 9% - 12% interest d. Can buy "off market" e. Credit not as important f. No real estate agent fees g. So a $300,000 house h. Is $90,000 down i. $1,700 to $2,200 a month payments j. Then taxes, utilities k. You bring in the rehab money l. Tend to be faster to decide m. Must have experience
Be careful of which hard money lenders you deal with though
John, I'm working that same first option here in San Antonio, taking over payments on houses where the seller needs out and the loan stays in place. Still learning it myself, so I'll leave the training part to you. The one thing that has stuck with me so far is the paper after closing matters as much as the payment. If the payment doesn't get made and credited the way it should, a good deal turns into a mess for everybody, and the rate on the loan is almost beside the point when the payment is one a real buyer can actually carry.
Specialist · I give advice - [email protected] - I focus on states where investing is profitable, reasonably safe & secure · Member since 2026 · 203 posts · 68 votes
John, I'm working that same first option here in San Antonio, taking over payments on houses where the seller needs out and the loan stays in place. Still learning it myself, so I'll leave the training part to you. The one thing that has stuck with me so far is the paper after closing matters as much as the payment. If the payment doesn't get made and credited the way it should, a good deal turns into a mess for everybody, and the rate on the loan is almost beside the point when the payment is one a real buyer can actually carry.
Yeah, it has to be treated with care and the buyer needs to be adequately funded. Did you get a title report before buying?
Good question, John. That is the part I am still learning to get right every time — knowing what is actually on the loan and the title before anything moves. I appreciate you asking it plainly like that.