When I started Flipping Homes my biggest challenge was securing financing. I'd heard and read about 100 - 110% financing, but wasn't quite sure that I'd be able to pull it off.
After all, who in their right minds would offer no money down financing and throw in another 10% to cover the cost of the repairs to boot?
Well, it turned out that lots of people would...and did, especially since their money was secured by property that would double in value after improvements were made. And to provide extra incentive I offered to pay premium interest for the money, which was typically around 18% per-annum.
And while 18% interest might seem high, it was a no brainer for me because I had none of my own money invested and every dime that I made was pure profit.
Still, as eager as they were to loan money I was equally motivated to flip properties as fast as I could to minimize profits lost through interest payments.
But no matter how you look at it it was a "win - win" situation. My financial investors got good interest on their loans and I leveraged my way into properties that I would not have otherwise been able to buy and made lots of money for my efforts.
Now, flipping real estate in today's market is riskier than ever, but money can still be made with a modified approach.
Specifically, if you can afford to buy and hold for a while, as a first time home owner for example, you can be positioned to resale bargain bin buys for big profits when the market turns around. And it will...it always does.
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