Making quick money is appealing for everyone, right? And investing in real estate is a popular method for anyone looking to earn passive income or if they want to purchase, fix, and flip a home, apartment, or multi-family building. But reality TV shows have a way of making the process seem much easier than it is. Popular shows often skip the most important part — financing the project in the first place.
At Lafayette Lending, we offer fix and flip loans for anyone getting started in the real estate investment industry. We offer a variety of options to ensure that you get the financing you need quickly and can start working right away. We offer short-term home loans, bridge loans, and hard money loans. Get in touch with our experienced team today to learn more.
Getting Started Flipping Houses
Flipping houses is a complex process, but here are some basic steps to help get you started.
Find a Fix and Flip Loan
Unless you have the cash on hand to purchase a property, you’ll need to work with a mortgage lender to fund the money for your purchase. There are a variety of options and no shortage of lenders to work with, so give yourself some time to research and ask plenty of questions. If you want to get started as soon as possible, a bridge loan might be a great choice. These short-term loans allow you to get the financing to purchase a property while you apply for longer-term financing. Another option is a straight-forward hard money loan, which is easier to get approval for and often has shorter loan terms. Contact Lafayette Lending to learn more about financing options.
Know the Market
A significant part of successfully fixing and flipping homes is understanding the real estate market and knowing what price homes are selling for. You may find an inexpensive home, fix it up, but find that it’s overpriced for the area. Or, you may complete a project and not fully understand how to effectively set a listing price according to the market. When flipping houses, consider working closely with a real estate agent or a mortgage lender who can help guide you through the purchasing and selling process.
Make a Budget
Start setting a budget even before you invest in a property. You need to know how much you can afford to spend, or how big of a fix and flip loan you’re willing to take on, how much you plan on spending on renovations, as well as marketing the property when it’s time to sell. Typical renovations include kitchen, master bedroom and bathroom, and certain cosmetic projects throughout the house. Other projects may include fixing or updating the plumbing, electrical, HVAC, or even the foundation. Set a budget for as much as possible.
Make Smart Renovations
Not every house flipping project needs top-of-the-line appliances, hardwood floors, or the most expensive tile in the entryway. Another part of knowing the market, and the importance of having a budget, is understanding what renovations will reap the highest return on the investment. If you only want to spend $60,000 on renovations in order to sell the house for $250,000, you may not want to spend the majority of your budget on custom cabinets.
Whatever your property investment goals are, it’s important to have a trusted partner you can work with. Get help financing your project with fix and flip loans from Lafayette Lending.