Ready to invest

[Lucy Rodriguez]

Hello, 

I’m excited on starting using the bigger pockets tools but I’m lost. I want to do a house flip but I’m in the middle of putting for rent what is used to be my first primary. What should I do first? Any advice plz! And what tools can I used from BIGGER POCKETS website that can help me with what I want to do…

[Brian Schroeder]

Hi Lucy!

Congratulations, you are in the right place. BiggerPockets is a great network that I have been a part of going on 3-years now. I have utilized its resources primarily to expand my horizons as a Realtor, and to get in touch with high-net worth individuals who are looking to invest in my new construction projects in Houston.

It sounds as though you are looking to flip or rent out a property. A few introductory questions you should ask yourself are:

1. Do I want to fix-and-flip or do I want to rent it out? -- And why.

2. What areas of town am I interested in?

3. Do those areas have favorable trends (i.e., is there appreciation)

4. How much house can I afford?

5. Am I going to self-manage the process?

6. Who is going to do my design?

7. Do I know tradesmen for each portion of the process?

When it comes to fix-and-flipping. The best way to go is off-market or direct to seller. You have equity, but you will need to get engaged with a hard money lender (who I can put you in touch with) so you can show on paper (I can close in ___ number of days and all cash). The hard money loan will be higher interest rate, and short-term. You will want to purchase the home at a discounted price with the formula below:

After repair value (ARV) * 70% - repairs - closing costs. The 70% equates to your required return and in most cases you shouldn't buy properties with less than 20-30% margin.

Please feel free to reach out and I can help you navigate the process.