Financial Advise for flipping

8 Replies

So I have a partner and we have all of the resources we need to flip a house but the capital is lacking. We don’t have much money to put out and was wondering what everyone else has done in a similar situation that could help us come up with some suggestions? We would even take on a third partner if they had the capital to help. Located in Maryland, any and all advice is appreciated.

If you don't have capital I would say you are missing the most important resource. Private money, hard money lenders, lines of credit, credit cards.

@Daniel Beaston find a great deal and then present it to someone that has interest in real estate and capital- it may be an uncle, cousin, friend from HS that is now doing very well. You never know who has capital lying around that they may be willing to invest. Be professional in your presentation and use the BP calculators and show them comps and scope of work.

@Daniel Beaston I know that @Eric Adobo 's advice sounds harsh but he is making a good point. You really only want to partner with someone that has something you don't, i.e. money, experience, time, etc.

What do each of you bring to the partnership?

Getting back to the root of your question, you only real options are a private money lender (more than likely would need to be friends or family), hard money lenders, or getting a line of credit secured by equity in your personal residences.

@Ryan Blake

So I have the resources to find properties and I can evaluate if it’s worth it or not. My partner has the people to do the work on the properties, lacking in funds is the only thing. We are going through all of our options financially but I think a flip may wait until we have the funds to where we aren’t killing ourselves in the beginning. Believe me I’m not offended or upset by any answers, no answer is too harsh for me. It’s best to hear it from the pros honestly.

If you can come up with about 8% to 15% of all in costs you can get something done in that area.

There are products that offer 100% funding in MD but your deal has to be at 65% of the ARV with all in costs

Your third partner is the money partner, but only on a per deal basis.  They will not only have to see that the deal is good, but also that you are capable of executing it, so you need to build relationships and trust.