Posted by loanranger1 on January 13, 2001 at 06:39:00:
only problem coming up with flipping property make sure buyers qualify people with bad credit going to Sub prime lenders are shying away from lending. want to see owners holding property for 12 months.
18 year old with question about flipping - Posted by Jason
Posted by Jason on January 12, 2001 at 02:32:10:
I’ve have recently gone through some of the how-to articles on how to get started and have decided that flipping may be the place for me to start. As a college student with no money I’m finding it difficult to get started. I have come across several properties that are run down and have begun to look into their owners. Once I locate the owners I would like to know how exactly I approach the process once I find out they are willing to sell. i.e what do I look for in the property and what questions do I ask the owner about the property?
If it determined that this property is a good flip what exactly is my role in the process? I d not fully understand what steps I take once I locate the property.
Can you please steer me in the right direction. i am very serious about getting started and am hoping for someone who can help. THANK YOU
Jason
Re: 18 year old with question about flipping - Posted by sharadom
Posted by sharadom on February 02, 2001 at 08:55:35:
ed and jason ,
i would like to know what approach you took to actually start on your flipping journey…any hints you can give me especially at our age…please give me some info about flipping and i would appreciate it thank you…
Re: One way to do it, - Posted by Ed Copp (OH)
Posted by Ed Copp (OH) on January 14, 2001 at 13:50:07:
Is to use an option. An option is a contract that you would hold. In the option contract you and the seller would agree on a sale price for the property. I would use a “cash” sale price for a property that needs to be repaired. The seller agrees in the option to hold the price for a certain length of time, lets say six months. In exchange for the seller holding the price for six months you would give the seller some money, let us say $100 (this is called the option consideration). Now lets use the number of $50,000 as the amount that the seller agree that he will take, in cash for the property any time during the next six month period.
So at this point you have an option (the right to buy) at a strike price (sale price to the seller) of $50,000. You have $100 invested, and your deal is good for six months.
Now you have six months to look for a buyer who will pay more than $50,000 for the property. I would suggest a price increase of 5-10%, something comparable to a real estate commission. You will be selling your option, not the property. So you do not need a real estate license, because the option is personal property (a piece of paper), not real estate.
You then take the deal to your rehab buyer and offer the house to them for a mark up, say $55,000. They can get thier own financing. If they agree to pay $55,000 they can pay you $5,000, and you will assign the option that you have to them. They then close in your place, and you are out of the picture with $5,000.
When you get your $5,000 payment take the check to the bank. Get it cashed and get 100, $50 Bills. Take them home with you and count them several times. You will then start to get a “feel” for what can be done in this business by an 18 year old business person.
No credit check, no loan, no job, very little investment. just good honest legwork. Good luck.
Re: 18 year old with question about flipping - Posted by R.Barr
Posted by R.Barr on January 12, 2001 at 08:20:57:
Jason, who would you be flipping the property too? Investors or retail buyers? First you have to have a plan on how you are going to flip before answering those questions you have.
Re: 18 year old with question about flipping - Posted by jason
Posted by jason on January 12, 2001 at 23:30:45:
I have located two house rehabbers in the area through the paper. Both told me to contact them with any houses they could turn for a ten thousand dollar profit or more. They alsosaid that in my area there are very few people willing to do the leg work in locating properties for them to redo. As of right now I have located two owners as well who are willing to sell. Both own paid off houses that are abandoned and that are in poor condition, but fixable. Thank you…