Let’s get one thing straight: it’s entirely possible to flip houses without taking money out of your pocket. There are plenty of investors interested in financing your first project. However, you’ll need to prove that you have the equity, creativity, and the willingness to take on risks.
According to research published by Attom Data Solutions, there’s no better time than to start flipping houses today. To help you get a head start on your real estate journey, in this article, we’ll present a short guide on how to flip houses with no money.
Private Money Lenders
Private money lenders are regular people that have disposable finances and are looking for smart ways to invest. In some cases, such people aren’t actively searching for a partner but are open to investing provided someone approaches them with a sound plan. Such lenders may have money stored in 401(k)s, banks, mutual funds, or IRAs.
The benefit of approaching private money lenders is that they offer low-interest rates and are much more negotiable. The key to convincing such lenders is to offer them a lucrative deal that includes a high enough interest rate. If you can find out what returns they are getting on other investments, you’ll be in a better position to secure a good deal.
Forming a partnership is one of the simplest ways to start flipping houses. Find a person who is willing to invest; this could be a family member, close friend, or even a co-worker. If you can’t think of anyone from the top of your head, consider asking people you interact with daily. This can include a friendly neighbor, your doctor, or an acquaintance from a previous workplace.
Here, the other person will fund your flip project while you do all the legwork.
Hard Money Lenders
Perhaps the best way to secure finance for flipping houses is to get in touch with a hard money lender. These are individuals or companies that offer loans at high-interest rates but have relatively short payback periods. Hard money loans make the most sense in real estate investment as time is of the essence.
Each market has hundreds, if not thousands of competitors and having access to funding to purchase a property is crucial in closing deals. The faster you’re able to flip the property, the more you gain from hard money loans.
In conclusion, while all 3 methods are viable for new investors, hard money loans will maximize your chances of successfully acquiring and flipping properties. GCP Fund offers bridge and hard money loans in Chicago, Naperville and Aurora, IL. They keep the interest of their clients first and offer loans at competitive rates.
Get in touch with them today for more information.