Hello, I've been doing a lot of research on the concept of house flipping and I'm ready to start but not sure exactly where. I've looked into certain loans and seen some lenders online, what's the best option or is there any legitimate option for buying a REO/foreclosure with a loan? Is there loans that will cover the price of the home and renovations? I'm aware I'll have to put down a certain percentage. Also have been looking at the different sites to buy these homes, will i need a license to buy them? I really want to do this and want to jump in considering it'll take some time. I'm in southern california, inland empire area. I would really like to talk to someone who knows what there doing. Thanks!
If you're just starting out I would not recommend flipping, using hard money or private money to flip especially if you have limited funds. Hard money Is very expensive, you will need a down payment if you’re just starting out and you need reserves to pay for your mistakes and cost overruns. The interest carry will eat your profits fast especially if you struggle to get the project done and sold quickly.
The best way to get started in REI is by wholesaling. Once you have done several deals gained some experience and have at least $100k set aside then you could try a flip. For now I recommend you focus on getting really good at finding buyers and finding good deals.
First step is to educate yourself on the business and your market. You really need to immerse yourself and learn all you can. Attend REI groups and meetups and network with other experienced investors.
Start with finding cash buyers.You will learn a ton from them and as you build a relationship they can potentially become a private lender or even partner with you on some deals down the road.
Best way to find cash buyers is networking at local REI meetups, masterminds, Facebook groups, Realtors, title companies, closing attorneys, property management companies, auctions, Craigslist, and bandit signs.
You can search real estate transactions in your tax database. Look for entities and individuals that have bought multiple properties. You may need to search by the address of the buyer as they may change their name or the name of the entity on each purchase. You can also buy lists from companies like list source and there are some REI software companies that have a cash buyer search feature.
Best way to find motivated sellers is to purchase lists and compile lists from city and county for 60-90-120 days late on mortgage, pre-foreclosure, delinquent taxes, water cutoff, code violation, probate, divorce, high equity, etc. and mail or cold call.
Other methods are driving for dollars, door knocking, wholesalers, craigslist, Realtors, FSBO sites, expired listings, foreclosure sites, put out bandit signs, billboards, newspapers, other offline publications.
You can use pay per click/adwords, facebook, Linkedin, Youtube, and other forms of online and social media marketing.
If you have a large enough budget you can do TV and radio as well.
You could letter up or wrap your vehicle.
@Emma McClendon Start by finding like minded people near you. That means start attending real estate investment clubs. You say you're in the Inland Empire so here are four clubs to check out depending on where you live.
First, the biggest is the Inland Empire Real Estate Investor Club which meets the 4th Thursday of every month at the Mission Inn in Riverside. I attend that club even though its an hour drive to get to it.
Then, TVREI Temecula and TVREI Apple Valley. Temecula meets the 2nd Wednesday every month in Temecula. Not sure when the Apple Valley club meets.
Finally, there is a good club in Coachella.
You can find them all on meetup.com and maybe on facebook.
The TVREI Temecula club has a mentorship program you can join though I imagine there might be a cost to that.
All club meetings cost $20-$30. Don't let anyone on BiggerPockets tell it's crap to have to pay to go to a club meeting (and they will tell you that) but they don't live in SoCal.
Also, if you live close enough, there is InvestClub in Fullerton. That's an awesome club.
And OCREIA in Orange County, Irvine or Cost Mesa.
Good luck finding your tribe.
Thank you for the information. I am a newbie, so any and all help is appreciated.
Find a cash buyer and become a bird-dog for them. They can pay you referral fees for each property you find... $5k to $10k+