Posted by Tom-Pa on July 03, 2002 at 17:10:20:
Matt, what part of Pa are you from? I may be able to help you so e-mail me and I’ll give you my phone numbers and we can talk. Tom-Pa
Ed and others, Is this how it works? -flip finance - Posted by Matt PA
Posted by Matt PA on July 02, 2002 at 12:28:20:
Ok lets assume I find a deal with these numbers:
FMV (after repairs): 50K
My Purchase Price: 20K
Repairs needed: 10K or less
I have only $500 to spend and plan on flipping this house to a more experienced rehabber for a 5K finders fee (25K). Ideally (and correct me if I’m wrong), I would like to tie this property up with a sales agreement (with a small earnest money deposit) and have it sold, or flipped, to that rehabber before I close with the original seller (double closing in, say, 90 days from original agreement).
OK let’s say I can’t find a buyer in that 90 day time period OR I had to purchase this house QUICK-LIKE from the start. I enlisted the help of my trusty hard money lender for a 20K loan at [insert interest rate here] for [insert length of loan here]. Is it possible to pay this all back as one lump sum after the flip which generated 5K profit for me? If it isn’t, won’t time and interest eat into my profit as the loan ammortizes?? How the hell do these flips work with hard money loans, or any loans for that matter???
I need to have a ‘moment of clarity’ quite soon. I haven’t done a deal yet but I’m well on my way to it all coming together. Please help me understand this guys! Pre-thanks - Matt Hegedus