First Time Flippers in South Tampa

[Daniel Sherman]

Good evening BP community,

We are under contract on a home in South Tampa and are trying to leap over every hurtle that comes our way. Since this is our first real investment and there are so many things to learn, we’re hoping for advice from the collective here. Let me break down the situation:

Purchase: SFR in South Tampa - Price $483,000; Rehab budget - $70,000; ARV $700,000

Down payment: $300,000; Hard money loan: $183,000 (12 months interest only)

Timeline: 9 month reno/3months on market/sale or cash out refi

The home is a large property with lots of potential and opportunity to blow the budget if we get carried away; however, there is enough room for mistakes before we lose our figurative shirts. We plan to take a hard money loan to close gap, but have no experience in this, so this is a learning experience all by itself.

We're exploring the idea of doing a cash our refi once the reno is done, but need to learn the best way to do so since the property will be bought under an LLC we are opening this week. My research says taking the home as a distribution to our names once we're ready to take ownership is the best path, but we'd love your advice. Our goal is to recapture the capital we invest into the home so we can use it in other places as soon as possible. If we can do the refi, it will allow us to live in the property and use the cash to continue investing. I know we're not the first to buy under and LLC and refi to a personal loan, but we don't want to stumble along the way.

Any advice is greatly appreciated and we look forward to sharing what we learn with you all along the way.

Sincerely,

Funda and Dan