Are you an HGTV fan? Would you like to be the next Chip and Joanna Gaines, or perhaps the next Property Brothers?
If you’re fascinated by the world of real estate investment, looking for a new restoration project, or just really like HGTV and want to try out some property renovation yourself, but don’t have enough cash on hand to buy outright—it’s still possible.
With investment property financing, you can buy and get right to work on knocking out those extra walls, covering up that ugly paint, and replacing cabinetry.
Be aware, however, that these big projects take time and money, and won’t be over in a weekend. If you do have the resources, connections, and know-how, however, fixing and flipping can be very lucrative.
Here’s how you can get started on your own fix & flip project.
Plan Carefully
From market research to setting a budget, there’s a lot to consider before you dive in. You’ll want to make sure that you’re shopping in a market that fits your price range, and that you know exactly how much cash you have to work with. Selecting your contractors at the beginning of a project can make the rest of the process go far more smoothly, as you need to stay on schedule to avoid losing money on your investment. Make sure you plan for unexpected circumstances; unplanned renovation expenses and monthly interest payments can add up. We suggest adding at least 20% to your rehab budget to cover unforeseen expenses. Most importantly, before you make an offer, make sure you have a lender who will fund your deal.
Hard Money Loans
If you already own investment property, or you’re looking to buy an investment property to fix up, then a hard money loan is the way to go. This type of loan can be drawn up quickly and is based on the real estate value you already possess or are purchasing. As a real estate entrepreneur, this gives you the speed and the necessary funding to close your deal fast. If you’ve got your eye on an investment property, check out our hard money loan options. There are other types of loans available that could be leveraged in a fix-and-flip scenario on your current home, like cash-out refinancing and home equity lines of credit, but neither of these offers you the same flexibility as a hard money loan.
Selling
Finally, once your property is open house ready, it’s time to sell! Many fix & flip experts make a point to stage their fixed-up home with artistic flair before bringing a Realtor into the picture, but that’s up to you. A good Realtor will help you set the price and can advise you on selling in that specific market. Once the property has sold, you can start the process all over again. And if you enjoy the process of flipping homes, and find yourself turning a profit, you may one day find it worthwhile to get your own Realtor’s license.
If you’re ready to start renovating, and you just need a property to start fixing up, Park Place Finance can help. We offer a variety of loan options for all types of needs, so contact us today to get your project started.