Читать книгу Flipping Houses For Dummies - Ralph R. Roberts - Страница 55
Finding financiers
ОглавлениеUnless you’re independently wealthy, you need a source of cash to get started. You may be able to tap into your savings account, mortgage your home, and max out your credit card, but strong financial backing from investors can provide you with the capital you need to leverage your personal investment. The big question is this: Who can you ask for investment capital? Here’s a list to get you started:
Start with your friends and family and your attorney. They already know you, and charity begins at home.
Tell everyone you meet that you flip houses. An investor may hear about it and contact you but be careful — an investor may be looking for a newbie to snooker into a raw deal. Question any deal that requires you to take on an inordinate share of the risk.
Contact doctors, lawyers, dentists, and other highly paid professionals you know who may be looking to improve the return on their investments.
You have two options for financing your flips with other people’s money (OPM): Borrow the money (and typically pay interest on it), or partner with the person and split the profits. Either option will cost you money, but both options enable you to move forward on deals you would otherwise lose. When using OPM, invest it in line with your lender’s or partner’s expectations — no bait and switch!
To protect your own and your investor’s assets when you purchase a foreclosure property, be sure you’re getting a mortgage in the first position — not a second mortgage or a junior lien. The person who owns the first mortgage gets the property — anyone else who has a claim to the property gets the crumbs if anything. In Chapter 9, I explain how to do your homework so that you know exactly what you’re buying.
If you contact everyone you know and you’re still short on cash, consider approaching a hard-money lender. Hard money is typically a short-term, high-interest loan. In Chapter 4, I discuss various types of loans, including hard money, and I provide more information on securing the financing needed to flip properties.
Finding investors can initially be a frustrating chore, but your future success will draw investors to you who are willing to share the risk and eager to work with an experienced and knowledgeable flipper.