All Forum Posts by: Orlando Paz

Just wondering... Is it possible to use hard money to purchase two or more flips? In other words... If I were to find two deals under $40k each, how possible would it be to use hard money? I am assuming that hard money lenders would not lend below a certain amount. In my example, the hard money lender might not be interested at $40k, but might consider at $80k. I do realize they base their decisions on ARV, but I'm curious to know if this has been done.

I agree with @Wayne Brooks. Everything needs to be documented from the beginning. Plenty of pictures, and videos from start to finish. Also wondering if a release of lien could benefit investor's in Texas.

From one newbie to another... You need to determine what your roll in the partnership would be. In the case of not having enough money (like me), I would say that you could offer to help out. In other words... "sweat equity". You may want to consider doing a live-in flip (which I am also considering). Worse case scenario, you may want to look into hard money. I don't think it's a good first choice, but it's certainly an option. Also keep in mind that a partnership can be risky. Especially if you are new to the game, and dealing with someone you don't know well. Although the thought of partnering with a contractor could work, also remember that contractors tend to have a certain reputation. Just ask the experienced flippers, and check out the posts on here. They see a newbie like yourself, and it could be like diving into a tank full of sharks. Proceed with caution.

I don't know about the legalities behind not living in an FHA property, but have you considered doing a live-in flip. You get to live in the property, tackle some (or most) of the work, and tax benefits. FHA also offers 203k loans. Not sure if this type of loan has the same regulations, but may be worth looking at.

If you are looking to resell, I would think that keeping your costs low is key. Focus on the basics... new paint, new flooring (if needed), new switch and outlet covers, new trimming (if needed), and new sink or vanity. No need for major expenses or tear down's. Leave that for the flip shows on TV. Also, make sure to purchase the most economical and quality materials you can find. The key would be to find that balance in savings and quality. Also staging/decoration goes a long way. Simple decorations from an outlet  or thrift store would help. If you have an eye for decorating, that's great. You can always find someone who can decorate for you, if it's not your strength. Make sure to take before and after pictures for your own records, and to show potential banks and private lenders (if you choose to be a fix and flipper).

Based on the 70% rule...

$130k ARV x .7 = $91k

$91k - $15k Rehab = $76k

This means that you should pay no more than $76k. It sounds like you are on target with this deal. Not sure if this helps, but it is a fairly accurate rule of thumb to go by.

I am looking at various ways to invest in mobile homes. I also happen to be very interested in note investing. Unfortunately, notes on single family homes are more than I can afford to invest in right now. Obviously mobile homes are usually less expensive than stick built. If they are newer homes, they are probably being financed. To me, this seems like a good way to get started with both mobile homes, and notes.

Can anyone advise me on this idea? also... how and where, can I purchase mobile home notes?

For the type of investment you are looking to get into, there are several common methods used. 

- Conventional Lending (Banks and Credit Unions)

- Portfolio Lending

- Personal Line of Credit (For properties around $35k)

- Peer to Peer Lending (For properties $35k and under)

- Government backed (FHA, VA, FNMA, 201k Loans)

- Partnering up with someone who will provide funds, while you provide other value (Ex. Sweat Equity)

- Private lenders (These are usually professionals with funds available to invest)

- Hard Money (Very expensive, but easier to obtain in comparison to banks)

 Hope this gets the wheels spinning! 

It's just a gateway to the abyss. Don't worry about it! lol!

I forgot to give the numbers... On one property: $30k, the other property is $18k. He only has $2500, which I am thinking could be used as a down payment.