How Do I Pay Myself to Fix My House

[Colton Boyer]

Hello everyone,

I am a rookie to REI so bear with me.

I have been working as a general remodeler for the past 5 years now. Over the past 2 years I've been working directly with RE Investors doing house flips. In October of 2022 my wife and I purchased a home for $125K with the intention of doing a live-in flip at a 5.25% rate. I have hit a snag in figuring out a creative and smart way to finance our flip with the proper exit strategy.

It was purchased as a 3 bedroom 1 bathroom house and can easily be converted to a 4 bedroom 2 bathroom home. We are looking to rehab the home and then refinance in a way for us to stay in the home a little while longer before eventually selling 5+ years down the road. Comps in the area would be from $210K-$230K conservatively. Rehab costs are in the range of $50K-$70K

I would like to perform a vast majority of the work myself and am looking for a way to achieve this goal all while paying myself to perform the work. Is obtaining a construction loan to perform the work, having an appraisal, then doing a cash-out refinance to pay the construction loan a viable method?

Thoughts and ideas are greatly appreciated.

Thanks,

Colton

[Chris Seveney]

@Colton Boyer

Bank will typically not lend to you as the GC on a renovation

Also why would you want to pay yourself? You will be taxed up the Ying Yang and pay interest on the loan?