If your idea of getting rich is buying this house, renovating it and then shouting to the heavens, “Please let me flip this house!”, you are definitely on the right track. Flipping houses is a very lucrative business. It used to be more so before the economy took a turn for the worse but if you make the property and the deal to go with it as sweet as possible you can still make a profit in this economy.
Think about it, even if you can’t flip this house right away you could still make some money by renting it to a family in need. Sounds like a win-win situation to me. You get a monthly cash flow and your tenant gets a nice house to live in.
So, how do you get started? If you have the money to invest then all you have to do is find a property that fits your criteria. You can find properties by scouring the classified ads in the paper, placing your own ads specifying what type of property you are looking for, making a list of the pending foreclosures in the legal listings of the paper, or go down to the county clerk’s office and go through the public records of foreclosures there.
All of these can be time-consuming and tedious but think about it like you are going on a treasure hunt. The more you look the better off you are and more likely you are to find that one little gem of a property that will bring you in a lot of money.
When looking at the classified ads in the paper, look specifically for ads that state ‘seller is motivated’ or ‘must sell’. If these properties have been on the market for a long time the seller will be happy to give you an even better deal than what their original listing price was.
So, what happens if you do not have enough money to buy this property? Do you have to abandon the idea of investing in real estate? The answer to this question is a resounding NO! You could try to get a loan from a bank but may find that the banks have tightened up their lending criteria and that it would be easier to try to pull the money out of a certain bodily orifice than getting it from a bank, there is another option.
There are such entities out there called hard money lenders. Hard money lenders will lend money to investors on the basis of the value of the property alone and expect a certain amount of return on their investment in you.
After you get the money from a hard lender then you need to put together a crew to do the renovations or maybe have a crew already assembled and on standby so you can get started with the renovations as soon as you get the money. No sense in wasting time, right? The sooner you get the reno done the sooner you can start making a profit when you flip this house.