To be successful at flipping houses, you have to have a plan. Getting flip loans is actually the last step in a process that begins when your first see the house you want to buy and fix up. The basic question is: do I have the resources to make a profit on this structure? Sometimes the answer is clear, and sometimes it’s not. Especially when you first start out, you might have to do some serious thinking and a bit of calculating. But you will also need a devil’s advocate. This is the person who will think of all the difficulties you could encounter in a project and force you to think about how to deal with them.
Before You Commit to Fix and Flip a Property, Go Over the Numbers with Your Devil’s Advocate
Most fix and flip people are optimists. They see a rundown shop or a neglected house and think of all the ways to bring it back to life. But when it comes to dollars and sense, a daydream is not going to make the books balance. This is where your devil’s advocate will come in. Ideally, they have more experience than you. They will look objectively at the location of the property, the price, projected value, and your funding plan. When they spot problems, they may also be able to help you come up with solutions.
So get to know people with experience in flip loans and repairing properties to sell. Other investors, a real estate attorney, a contractor you can trust–these are all people you can ask to help you find and make the best deals.