Updated over 8 years ago on . Most recent reply
Leverage in Fix-and-Flips
My friends and I are starting out by doing fix-and-flips. Some of them have expressed a desire to use all our cash to do the first deal, but I'm wondering if we might be better served by taking out a loan. I understand and like the idea of using leverage to build up a portfolio of buy-and-hold properties, but I'm not sure if it translates to the flipping realm. Do the leverage principles from buy-and-hold (i.e. instead of plopping down $100k to pay for one property, you can get five properties at $20k each, with mortgages) carry over to fix-and-flip, especially when we are talking about our first deal?