100K with NO experience.

[Cory Zimmerman]

I’m 20, brand new RE agent in Arizona. My grandparents want to loan me 100K so I can flip a house and make a return! However I have 0 experience with flipping/ investing. Should I just go all in all chips on the table and learn that way? Any thoughts/ tips/ input??

[Kevin M Finley]

I guess I'll offer a little bit of an angle that others are not. There is no rush to put the money to work it doesn't sound like, so since you have your license and presumably MLS access, start researching. Take a look at the areas around your town that are selling quickly and what numbers they tend to bring. Become very confident in calculating your "ARV" (After Repair Value). If you don't know what the house will be worth when you are done, you have no business even starting. Don't calculate your "It could go for" number, calculate what price you would list at in those areas for the house to go under contract within 14 days and close quickly. This number will be more accurate.

Now with regard to selecting a property, you have a few things going for you that will put you at an advantage over other flippers (like myself). 

1. 1. You do not have interest or financing costs.
2. 2. You are presumably willing to do a large portion of the work yourself. 
3. 3. You are willing to use this as a learning experience and aren't trying to make 20k off the top. (It's your first flip, if you look at it this way you'll drive yourself crazy)
4. 4. You save realtor/transaction fees. 

All of this being said, do not get in over your head. Don't take on a project that is out of your control and something that is difficult to budget for. The perfect flip for a newbie will typically need paint, carpet, counters, plumbing fixtures, and MAYBE some subcontracted roof, windows, electrical upgrade, furnace, etc. Here is the profile of a house that I was trying to buy but couldn't agree on numbers a month or so ago:

ARV: $180k

Work needed: Paint throughout. 2 windows. Roof on house. Water heater. New toilet and vanity. Light fixtures. Outlets and switches. countertops (cabinets were fine).

Subcontracted budget: $18,000. Self performed budget: $7000. I don't self perform but I highly considered it. 

I got the seller down to $133,500 but I couldn't get him any lower. My financing charges would have been nearly $10,000 and with realtor fees on the back end, I would barely make $15,000. I won't touch a deal if there's less than $20-25k profit. 

This would have been the perfect deal for someone in your position, and a low risk deal at that. Even if you mess everything up, there is only so much damage you're going to do with a light cosmetic flip. Going all in is fine, but minimizing risk and making sure you know your numbers is important. 

Sorry for the long post, but I've had a good amount of success by going all in, and I didn't have the head start that you already do. Throwing yourself at it is fine... just be smart.