Too aggressive or early to start flipping?

Question

I currently own a duplex in NJ which I am renting out half of unit and living on another unit. I am looking forward to do my next deal through either flipping ( buy fixer upper), purchase rental in low tax area, or buy a house through auction.  The thing is that it has only been 6 month since I bought my first property and I dont have 20% required for what most conventional, or hard money lender requires.

Would it still make sense to aggressively find a lender(or hard money lender ) or just wait until 20% is ready? I feel like I am losing out on lots of good deals especially when the interest rate began to go up. or am I too aggressive and taking on too much leverage?

Account Closed · Answer

Thanks Charles and Mark. That was exactly what I was thinking. I was thinking about partnering up with my realtor or banker so that they finance my down payment ( even better if the whole mortgage amount but I doubt people typically have that much cash available ).

But people think its risky and too aggressive. Properties in Northern NJ is expensive and saving up for 20%-25% will take many years. So far hard money lenders still seem to require 20% down for skin in the game.

Mark Langdon · Answer

Super Congrat's on doing the house hacking with your first duplex. If the numbers work really well then its up to you to decide if you are too aggressive. Most folks are the opposite and never do their next deal. Hard money works fine for flips as long as the numbers work well and partner up to get the down payment. There is a tiny amount of private money folks who may do 100%. Don't let money stop you from going to the next deal. You just have to work harder to find it.

Charles Doehler · Answer

Missing good deals feels bad.  Especially if the market starts getting low on inventory.  Lots more goes into this decision for most but you sound like a risk taker.  Focus on the potential spread and make sure you are good at that.  Loan depends on realistic turn around with realistic costs.  Sitting on asset with hard money loan is usually not good.  This is the time to consider a partner (even spouse lol) with means.