How I funded My First Flip

[Glenn Espinosa]

Hi all. I'm working on a blog series to help the newbies and wanted to get some material from some of the experienced flippers out there. In one simple sentence, where did you get the money to fund your first flip? Eg. conventional loan, HML, savings, credit cards, family, friends, etc.

I'll start:

First flip was funded with 10% personal savings, 20% loans from friends, 30% credit cards, 40% construction loan from credit union.

[Brian Burke]

I simply had no other options at the time. If I hadn't done that, I probably wouldn't be where I am today.

[Jennifer Lee]

First home: wedding gift, free clear...opened line of credit (Rental)
First flip: 100% family, promissory note (rent/sold)
Live in flip: conventional 80%(sold)
First commercial: 5 yr ARM (rent/selling)
Current home: conventional 80%
2nd commercial: home equity from first home(rent)
2nd flip: investors project, investors $ cash (work in progress)

[Pace Jordan]

This is a great topic. Im definitely looking forward to the answers you get here. Im a newbie and this is the exact type of thing I need help with! Thank you.

[Glenn Espinosa]

Thanks Pace! I figured a lot of new guys could benefit from a topic like this. Now we just need the veterans to start chiming in. Guess all of them are sleeping in this weekend!

[Jon Klaus]

I bought my first flip from the VA auction that was offering 100% financing to investors.

[Account Closed]

I used a home equity line of credit to purchase ours.

[J Scott]

First one was cash from savings. Second one was a conventional loan with a cash downpayment. Next few were portfolio loans with cash downpayments.

[Dell Schlabach]

First one was from a line of credit from another company I owned.

[Steve Wilcox]

First property was a live in, FHA 3.5% down
Next ones were all cash, including current project
Now moving toward building relationships with hard money lenders and other private money sources

It would be interesting to hear from some of the really seasoned investors doing this on a large scale, how they progressed from first deal, up through to where they are now, what they might have done different, or wish they had started doing sooner.

[Brian Burke]

My first flip was subject to existing an existing loan, and I used cash advances from a credit card to bring the loan current. Then used credit cards for the rehab.

[Glenn Espinosa]

Brian Burke - That's awesome! In the past I've networked with people who frowned upon my use of credit cards as a method to break into real estate.

It's risky and just about every other method is better BUT if the deal is juicy and the numbers are true then I ask why not?

[Brian Burke]

I simply had no other options at the time. If I hadn't done that, I probably wouldn't be where I am today.

[Pace Jordan]

Brian Burke, did you do the work yourself? When did you decide to go into real estate full-time?

[James Vermillion]

First purchase was a commercial loan from a regional bank.

[Brian Burke]

Pace Jordan, I'm not too handy, I leave that up to the pros. Went full time over 10 years ago.