What's enough cash reserves?

[Ivan Reyes]

My partner and I are securing a hard-money loan to do flips. Low to mid priced homes with ARV of 80-100K. We are working on our first flip at $70k ARV. We are planning on getting a private loan of $5k so we can have some cash reserves.

The reserves would be to pay the initial initial draw to the contractor and marketing. The loan would be secured by the property until we retail it.

Is 5k enough in your opinion? Also how much should the contractor get up front. I hear many people saying 1/3 up front and the rest in 1/3's. Any thoughts on reserves and the up front to the contractor?

Thanks.

Ivan