The 'value' of cash

[Mike Seluk]

Very often I read about people getting the ball rolling without having much cash on-hand. A good friend of mine just did this. He just bought his first place to flip and he did it with no income varification and very little money saved up.

I've been looking into a couple properties to flip myself, and it seems like there are loan types that allow you to get the money you need for the repairs (as my friend is doing). Or you'd finance the property first, get an appraisal for the ARV and refi based on that (is that correct or am I way off?).

I've been saving for a while and find myself in a wierd situation, I think. If I'm going to flip something, I probably don't need much of my own money because if all works out well, I'll be borrowing the money for a short time (I think). On the flip side, things are still too expensive to cash-flow if I want to hold and rent, and I don't quite have enough money to put into it up-front to make for a small enough monthly payment to make the cashflow numbers work well enough.

Sooo...keep saving? Look harder for flips?

EDIT: I just realized that using cash as a down payment can allow me to get out of having to pay PMI - that's a plus!