New investor in intown Atlanta

[Michael Davis]

I'm a full time attorney in Atlanta and I want to start flipping houses on the side to generate extra money. My work is my job but I want to do something I am passionate about, and I have become very passionate about real estate. My credit score is great (824) but I don't have liquid cash to purchase a house and pay for the flip. I own a house in Athens, Ga. that I am renting out and I am renting myself here in Atlanta. My partner owns the house we live in and I pay rent to him. The neighborhood has really taken off and he has a lot of equity in the house now. I have been reading a lot about house flipping to educate myself and of course watching the house flipping shows on TV. I fully understand the process is not as easy and glamorous as they make it seem on television. I have become familiar with the areas and neighborhoods I want to make my niche. I have even scouted the real estate apps and found potential properties for sale that I believe are undervalued based on comps in the area and potential for profit with renovations. I am not going to rush into something unless I know I can be successful at it because I don't want to ruin my credit. But I don't want to miss out on opportunities, either. I have a friend who is a contractor and is interested in flipping, and another friend who is an interior designer. These are people I know I can trust and I could hire them to help me. My partner is also an attorney, and although neither of us do real estate law I am confident we could learn it. I feel like I have a pretty good team in my network, but don't know what to do next. I am meeting with a realtor later today to discuss my goals. Is this the right step right now? How do I get started? Do I need to ask a bank for a loan to flip? Do I need money first and then find a house or find a house first and then get money? Is it possible to get financing with little or no cash down based on great credit and a house I'm renting out but still owe money on? Any advice is greatly appreciated!

[Curt Smith]

Hi Michael, welcome to Atlanta and BP.  My #1 tip is to join ALL the local REIAs.  Then sort out which ones help you the most with face to face experts, fellow flippers etc.  Its harder than HGTV makes it look in Atlanta!!!!!   I've been brought in on a few newbie flippers who got screwed by a range of trip wires and nearly lost their shirts.  Both ended up putting long term financing on the houses and either rented or rent to own to buy time to break even....

You need to learn MAO accurately and how to calc ARV very accurately Both have problems.