Even the most successful house flippers — people who flip multiple properties at a time and make $100,000+ per flip – those flippers utilize fix and flip funding from private money lenders. Do they need to secure funding? No, the most successful flippers have plenty of capital to make their purchases on their own, but they choose not to.
Why? Because the best house flippers understand that they can leverage their assets more effectively and more profitably with the aid of private money.
House flipping loans are a critical tool for the prepared house flipper. Securing a residential rehab loan before identifying an investment property has become essential in the current house flipping market. Here are three reasons why:
Competition is steep.
House flipping is extremely popular, and there is plenty of money to be made, which means you’ll have other house flippers competing for the houses you’re interested in every time, guaranteed. In fact, if there aren’t any other flippers zeroing in on a property you’re interested in, you should think long and hard about what they might know that you don’t. Securing residential rehab loans in advance will give you a competitive edge that you won’t be able to survive without.
Speed is key.
With a rehab loan in hand, you’ll have a weapon in your arsenal that will help you stand above the crowd. When it comes time to make an offer, you’ll be able to get yours in first and be able to complete the transaction within a matter of days rather than a matter of weeks. That will give you an edge over other offers and allow you to get moving on your flip.
A better budget = a more lucrative result.
If you wait to secure a loan until after you’ve bought a property or put in an offer, you may end up with a loan for less than you’d hoped for or on worse terms. As a result, your budget will get knocked out of whack, you’ll face delays or be forced to take shortcuts, and your final ROI will suffer. Having your funding in advance allows you to be a better planner, to figure out your margins, your costs, your resources, and your fees before diving in, leading to better results every time.
If you have questions about rehab loans, contact ZINC Financial today by calling 559.326.2509. Our real estate experts can help you understand your options and give you advice about the best rehab loans for new investors.