I Don’t Have Money…Can I Flip Houses?

All too often people with big dreams sell themselves short because they think they need lots of money to get into the Real Estate Investing game. These self-limiting thoughts sideline many people who could change their lives with just a little knowledge of the Real Estate Investing industry. As an elementary school teacher, I once shared this belief set. 

After spending time with others that were doing what I wanted to do, flipping houses without any of their own money, I realized that I didn’t need my own money to be a flipper. I now feel a responsibility to share with others what I learned along the way. Lack of money is not a limitation and those that think it is are just making excuses.

So the question is, where do I get the money to do the flips and my Real Estate Investing deals? There’s no real mystery to this. Don’t keep what you do a secret. The key is to engage others in conversations about Real Estate Investing. Due to popular reality TV shows about fixing up houses for big profits, a vast amount of individuals have an awareness about what we do as Real Estate Investors. Most are intrigued by the idea. At a time when the stock market is shaky and returns on most traditional investments are low, investing in your flips will look quite enticing.

Private Money Lenders

Private Money Lenders as we like to call them can be just about anyone you meet or know. They are just regular people like you and me who have retirement accounts or disposable income reserves that they are looking to invest with. They may not be actively seeking new investment vehicles, but if you know them and talk about what it is that you do, then chances are very good that they will sit down with you to hear what you have to offer. My advice is to offer them 50% of the profit and partner with them. That way you create a win-win situation.

One of the best places to go to look for private lenders who might want to back you on your next flip can often be found at your local Real Estate Investing club. Many times people frustrated with the low returns will go to these clubs hoping to find a better alternative. Something to keep in mind is that according to the Bureau of Labor Statistics, the average American changes jobs every 4.4 years. That means there are a lot of neglected 401k’s and IRA’s out there that can be used to back your fix and flip projects.

Another option for funding your Real Estate Investment deals is to approach friends and family. There is little to no rules and regulations surrounding those close to you. They are much easier to approach and usually they want to see you succeed. Just keep in mind that if things don’t work out, Thanksgiving or Christmas can be an awkward time if there is bad blood over money owed.

Hard Money Loans

Hard Money Lenders which are usually expensive are a great alternative option when you are starting out and need money for funding a deal. They have little interest in your credit score. They focus on whether they believe your potential deal will be profitable. They will charge points and fees and high interest rates. These rates generally range from 10%-15% annualized. If they won’t fund your deal, there’s a good chance that it’s not really a deal and you should walk away.

Although we only listed a few ways to find money for your flips, there are numerous ways to work with investors that will back you on your flips. The key is to always share with people your goals and objectives. Learn how to secure their investments to protect them and they will be much more eager to work with you. Keep in mind that money is all around you.

For more information on real estate investing tips, fix and flip advice, real estate wholesaling education, real estate investor training and much more, make sure to follow our blog at: http://fortuneweavers.com/blog/