All Forum Posts by: Tim Porsche

Hi Mindy,

Thanks for your response, that is the kind of feedback I was looking for. I wasn't sure that a 100% HELOC would be possible to get on a rental property, so I'll have to look at alternate ways of acquiring the funds needed. To answer your questions...

How sure are you of your ARV? - I'm not actively looking at any properties to flip at this time. I wouldn't start until Spring 2016 at the earliest. When I do find a property that I'm interested in though, I'll do all my due diligence and make sure we are confident of the ARV based on what other comps in the area have sold for recently. 

Do you have any recommendations for contractors? - Again, I'm not looking to start flipping until 2016, so I haven't gotten that far yet. I'm trying to tackle one piece of the puzzle at a time. Right now the puzzle piece I am working on is how to finance the flips. If I can't do that, then the rest doesn't really matter.

Don't forget to factor in selling costs when figuring out how much money you will put into the flip. Have you read J. Scott's book, The Book on Flipping Houses? It comes with a free bonus book The Book on Estimating Rehab Costs. - Yes! I am actually about 3/4 of the way through it now. Great book and I'm learning a lot from it. 

Since getting a 100% equity HELOC probably isn't going to happen, finding a partner just might be the best way to go. My struggle is that I don't have any experience doing this, and in a partnership, both parties should bring something to the table. What am I going to be able to bring to the table, having only about $15,000 to contribute, and no experience? Ideally I'd like to find someone to front about 80% of the costs associated with the flips, while I do all of the work and planning. Ideally they would be an experience flipper, and could also function as a sort of sanity check, to confirm a deal is as good as I think it is when I find one. Do you think I'll have trouble finding someone like this since I have no experience flipping?

Thanks! I'm planning to and really excited about it. So you think my idea about getting a $35,000 100% home equity loan (I read these are hard to find, is that true?) and then a traditional 20% down mortgage would work? 

Also, with a traditional mortgage, what things need to already be in place in the house for them to give you a mortgage? I know you need to at least have a stove and a working water heater. Say I find a house that doesn't have these two things but is a great deal, is there a way I could still get the financing via a traditional mortgage? Sorry if these are dumb questions, I'm just trying to think everything through. 

Hey all, so I am planning on getting into house rehabbing and flipping in Spring 2016. I need a little time to build up some more funds, and do more research, and get a good team of contractors, real estate agents, etc together. Now I'm not going to have enough cash on hand to finance everything by myself, so what I am thinking of doing is the following. 

1. Get a 100% home equity loan in the amount of ~$35,000 from my rental property.

2. Use $10,000 of that to put down 20% on a ~$50,000 fixer upper house, and another ~$5,000 for closing costs

3. Use the remaining $20,000 to rehab the house, and pay holding costs.

4. Try to sell for around $90,000 - $100,000, and make $10,000 - $20,000 in profit hopefully.

Does this sound like a doable plan? Am I missing anything big? Does the financing sound like it would work? To give you more details about my financial situation, I currently own one rental property, a single family home that is worth about $130,000 now (conservative estimate, might be more). I owe roughly $88,000 on the mortgage. It is netting me roughly $550\month total profit before taxes. I plan on buying a primary residence home within the next few months, so I will have another mortgage of about $800\month, including property taxes, insurance, PMI, etc. By the time I would start rehabbing in Spring, I should be able to save at least $10,000 in my bank account as an emergency fund. In addition to that, I have about $6,000 in gold\silver, and $10,000 in retirement accounts.

Any advice would be greatly appreciated. Thanks in advance :)

Thanks for the replies Ben and Christopher, lots of great information there!

I'll try to clarify question #2 a little better for your Chris. What I meant was, basically how often do you actually end up making enough money where it is worth your effort doing a flip? I know that obviously the intention is to make money every time, but of course unforeseen things can always come up (repairs ended up being more costly than you had calculated, you have trouble selling it for a profitable price for whatever reason, etc). I guess I was just wondering how often you have run into serious unforeseen issues that make turning a profit hard or impossible?

I'm still waiting for the the book to arrive that I ordered and plan to do a lot more reading and research before I would attempt my first flip. Also I'll probably wait until I have more cash on hand and can finance most of the flip myself...might be a couple of years yet, we'll see.

Hi All,

I have been thinking about getting into the house flipping business, but admit I am a complete newbie and really know precious little at this time. I've ordered the book from BiggerPockets on house flipping from Amazon, and plan to read over it and learn as much as I can before deciding if this is something I want to pursue or not. Anyway, I have a few questions for those of you who have done house flips in the past, and would super appreciate any responses\information you could give to help me out.

1. For my first house flip I would probably start small, try to get something under $100,000. My question is, would I need (or is it advisable) to have money of my own to put down on the house, or could everything be done through loans? If I have to put down 3-4% that would not be an issue, I'm just trying to get an idea of how much cash money is required to do a flip like this.

2. If you do your homework, research, and preparation properly, in general, what percentage of the time do you a. Make enough money to make it worth your time and effort, b. Make enough money to roughly break even, c. Lose money, either a lot or a little? I know there are always risks involved, and I'm okay with that, I just want to make sure that they are smart risks. I also do own a rental property already, so if I would have a flip that goes bust, you could always rent it out and recoup most of your money over the long term right?

3. Is doing a flip something that can be done part-time on the side, if you already have a full-time job? Or is it something you need to dedicate yourself to full-time?

4. I know this must vary widely, but on average, how much time per week would you need to do a house flip? Assuming you have contractors do most of the work.

5. Admittedly, I'm not the handiest man in the world... When house flipping, do you do a significant part of the rehab work, or do you mostly pay contractors to do the work? I could do general labor things like painting for example, but when it comes to electrical, plumbing, etc...not so much.

6. Are there any particular bits of advice that you would give to someone new to house flipping, or thinking about getting into it? Anything that you wish someone would have told you before you started house flipping?

Any advice is hugely appreciated, thanks in advance for taking the time to read this and for your responses.

-Tim

Hi All,

I have been thinking about getting into the house flipping business, but admit I am a complete newbie and really know precious little at this time. I've ordered the book from BiggerPockets on house flipping from Amazon, and plan to read over it and learn as much as I can before deciding if this is something I want to pursue or not. Anyway, I have a few questions for those of you who have done house flips in the past, and would super appreciate any responses\information you could give to help me out.

1. For my first house flip I would probably start small, try to get something under $100,000. My question is, would I need (or is it advisable) to have money of my own to put down on the house, or could everything be done through loans? If I have to put down 3-4% that would not be an issue, I'm just trying to get an idea of how much cash money is required to do a flip like this. 

2. If you do your homework, research, and preparation properly, in general, what percentage of the time do you a. Make enough money to make it worth your time and effort, b. Make enough money to roughly break even, c. Lose money, either a lot or a little? I know there are always risks involved, and I'm okay with that, I just want to make sure that they are smart risks. I also do own a rental property already, so if I would have a flip that goes bust, you could always rent it out and recoup most of your money over the long term right?

3. Is doing a flip something that can be done part-time on the side, if you already have a full-time job? Or is it something you need to dedicate yourself to full-time? 

4. I know this must vary widely, but on average, how much time per week would you need to do a house flip? Assuming you have contractors do most of the work.

5. Admittedly, I'm not the handiest man in the world... When house flipping, do you do a significant part of the rehab work, or do you mostly pay contractors to do the work? I could do general labor things like painting for example, but when it comes to electrical, plumbing, etc...not so much.

6. Are there any particular bits of advice that you would give to someone new to house flipping, or thinking about getting into it? Anything that you wish someone would have told you before you started house flipping?

Any advice is hugely appreciated, thanks in advance for taking the time to read this and for your responses. 

-Tim