Funding for first fix and flip

4 Replies

Good morning everyone,

I was wondering, what are your opinions for getting funding for my first fix and flip. I do have some savings and some equity in my primary residence, but not enough to fund an entire deal. I also have a good credit score 725+ along with a fairly well paying W-2 job. This would be in the greater Sacramento area.

Is there any chance a portfolio lender funding a deal with an inexperienced flipper?

@Jason J.

Welcome to BP.

Yes, a local bank / portfolio lender should be able to assist you with your financing needs. They probably would want to have your account moved to them (you will transfer your checking / saving account there).

I'd start small local banks first.

Hope it answer your questions.

Originally posted by @Jason J. :

Good morning everyone,

I was wondering, what are your opinions for getting funding for my first fix and flip. I do have some savings and some equity in my primary residence, but not enough to fund an entire deal. I also have a good credit score 725+ along with a fairly well paying W-2 job. This would be in the greater Sacramento area.

Is there any chance a portfolio lender funding a deal with an inexperienced flipper?

 You might also talk to a bank about an unsecured line of credit.  I'd start with whatever bank you use for your usual banking.  Then move to others.  There are a number of them that offer them, and they can provide a lot of flexibility.  They have higher interest rates than secured loans, but can be powerful tools.  

The other option would be hard money, but that may be difficult as you don't have any experience. You'd have to identify the deal and make it look attractive. The more of the cost you are covering yourself, the easier it will be to find a HML who is interested. This will be far more expensive than an unsecured line of credit, but may allow you access to more money than otherwise available.

Finally, private money is always an option if you have friends or family who would like to help back you.  You have a lot of flexibility as to how you structure that--you could split profits (like equity) or you could pay them a fixed return (like debt).

@Jason J. Considering you have a good paying job and credit score, you should be able to conventional finance the purchase, but you will need to have enough available for  the renovation and carrying costs.  Now depending on the deal you might be able to get creative with the financing.  This all depends on what you are looking for from the lender.  Do you know what you are looking for at this point?  Just money for purchase? Just money for Rehab? Money for both?  

@Jason j

@Jason J. I can get you funding for your deal if you find one. That is the easy part. You don't have move checking accounts anywhere either. I have access to private lenders and lower costing portfolio lenders if the house is not a major rehab.

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