Financing to participate in Auctions

[Eric Betten]

Hello BP Community. 

I am breaking into real estate investing this year as a licensed and insured electrician by trade. My goal is to flip in the first quarter and 1031 the proceeds into a cashflow property. My question is can you get financing (or OPM, other people's money as Robert Kiyosaki would say) to participate in an auction. My mentor who owns several multifamily buildings and my business partner who is an independent property manager/licensed electrician both said you need your own money to enter an auction. 

Is this correct in all your experiences as investors and lenders? I can draw up a solid business plan that shows that the property will be a profitable flip using the fix n flip calculator and the methods described in the book on house flipping houses to accurately price your property. I understand from a lenders perspective why this may be less than ideal but if the bid exceeds the maximum allowable offer, I can just stop bidding on it. Seems a shame I have to pass up on all these potential leads because I can't find financing. 

Thanks for your time, keep on hustling. 

[Scott Wolf]

@Eric Betten, yes it is possible to get hard or private money for an auction, but you need to start making those connections now.  Go to local RE meetups, and find investors doing what you're trying to do.  

Just an FYI, you cannot 1031 a flip. You can try to BRRRR and make the property you're rehabbing into the cash-flowing property you desire.