Personal Loan for down payment to get started???

[Nalo Coban]

Hello BP family,

What are your thoughts on taking out a personal loan of $10K to use as a down payment to get started on RE flip?

Has anyone done this before?

What are the pros & cons?

[Joe Stafford]

Loans, borrowed money, lines of credit even credit cards are all acceptable. Make sure to account for the interest or the cost to obtain that money into all of your figures. Borrowing money can be expensive and wipe out your profit especially when new because there is a lot you may not account for or under estimate with a rehab (in my opinion).

I have a line of credit on my personal home that I use on flips and then pay it right off when it sells. I do not use this line for buy and holds as it is an interest only line. I even have a very high limit Credit card that I put most everything for my rehab on so it cost me very little out of pocket to keep flips moving.

Hope this helps.