Feeling stuck- what would you do?

[Anne Williams]

So I started my very first flip in August w a target finish in early October. Details below.. a few surprises but on track to pull down the ARV and make around 30 k.

So we put it on the market listed way too high the week before Halloween and after a quick contract acceptance we ended up getting beat up by a VA appraiser and we terminated contract. So now, my hard money loan is a 6 mo balloon, and I am getting killed on the interest payments.. all my money is tied up in it. Around 160k. I need to sit on it for at least another month in order to get what I want for it.

Here is my question.

What do I do if the balloon happens before I can sell it?

Looking at a 1 year rental situation.  Cash flow is around 700/ mo after expenses.

Looking at selling it to my spouse to pull some money out.

Cash out refi conventional requires 6 mo seasoning to get the appraised value.

I am not a full time flipper, I am patient and am considering the dollars and cents of it all.

Wondering if anyone has experience converting a flip to a rental?  Any advice on leveraging?

Thanks for your help!

I have been doing buy and hold for 19 years..  just not like this..  seems like if I can get this to work, it might be my new business model.. 😀

[John Teachout]

I see a list of common flipper mistakes in this thread. And almost every flipper makes them on their first flip.

1. Over estimating ARV

2. Underestimating repair costs

3. Underestimating holding time

4. Underestimating cost of money (due to 2 and 3 above)

This results in a loss many times. The longer you wait before aggressively marketing the property, the more bleeding will take place. ie, if the property was sold sooner at a lower price, it would have been better than selling later at a lower price. I'd suggest you get out from under this situation asap, regroup and move forward from there.