I am frequently asked, “Where can I get the money to do a Real Estate Flip?” There are a lot of people out there that would like to try to Flip That House, but they don’t even try because they either don’t have the money and/or don’t think they can get financed. But the truth of the matter is that you don’t need any of your own money to Flip That House and you don’t need good credit. You can get the money even if you have BAD CREDIT.
To begin with, there are lenders out there, and I am not referring to conventional lenders, that will base their determination on the quality of the deal and the asset (property) itself. Your credit does not even enter into the equation. If they can see value in the deal and that money can be made by not only the borrower, but themselves, they will be more than willing to provide the money to complete the deal. These lenders have been referred to as Hard Money Lenders. But there also Private Money Lenders who will lend you money every day of the week based on the merits of the deal.
Now I must admit that there are equity based lenders out there that do require a minimum of a 620 credit score before they will lend the money. But that is not true of all of them. There a plenty of others who are strictly value based.
The first thing you will need to do is acquire a property and enter into a deal that follows the 70% rule. We discuss the 70% issue in more depth at Flip That House Website, but simply put it means that the purchase price and cost of repairs on the property must be no more than 70% of the ARV (After Repair Value).
Some hard money lenders, because of the housing meltdown, are now requiring a 10% deposit. But I will show you, in future posts, how you can get that money too, so you don’t have to use your own money. So stay tuned and continue to visit www.FlipThatHouseWebsite.com for more tips on how to Flip That House.