Advice for starting in Virginia

[Michael Crump]

I'm looking for some advice on how to start my REI career in Northern Virginia and reading through all these options has my head spinning a little. Here's where I'm at and would appreciate any suggestions.

I'm currently unemployed and would like to start flipping full time. My savings has dwindled during my months of unemployment but I have spent my free time upgrading my SFH and should have no problem selling it for $50k+ more than I currently owe, according to comps. I would like to live here into the summer and flip a house during that time but don't see a way of funding it without selling. Suggestions?

I do not have a private lender to get a home but have a lender willing to fund the rehab cost if needed. I have $110k in my 401k which I've read you cannot use. I read briefly that a roth IRA can be used somehow but not sure what that entails and if it's possible. I plan on researching this more. I also own a condo that I lose $200 a month renting and still owe 10k more than current comp sales.

I'm considering quickly getting my real estate liscense for the education, access to homes and solve the unemployment issue.

Any tips and suggestions would be greatly appreciated. Thanks

[Lynn McGeein]

Is it possible to rent out rooms in your home while you get your real estate license and start working in that field for a while? Selling your home to get funding for a flip may sound like a good idea, but I would think it works only if you could buy that flip for cash with the proceeds and plan to live in it while you are working on it as I don't see how you would get a purchase loan if you are currently unemployed. There might be hard money lenders who would fund your deal (without you having to sell your home), so that might be worth looking into, and you could use your rehab lender as a backup. Also, research your specific 401k policies to see what your options are regarding loans or withdrawals with penalties so you know exactly what access you actually have to that money if needed.

As far as the other condo, is it possible to work out a short sale with the bank and get out of the monthly loss? Does that loss include repairs and fees, or is that $200 loss just the mortgage payment versus rent? The bank might be much more easy to deal with as you are unemployed currently than they would be if you had a steady job right now, so worth a discussion with them about it. Even if it hurts your credit, you are likely looking at a few years to build up credit once you become self-employed in real estate, anyway, so you could be doing it all at once, clearing the slate instead of hanging onto a loss, unless the market is returning to that condo area and you see it appreciating enough to get you out of it soon without a short sale.