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Old 04-11-2010, 04:01 PM
 
2 posts, read 40,580 times
Reputation: 12

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Hello everybody, well I'm 26, about to graduate from college this dec (spent 5 years in the navy prior to starting school for those of you thinking I'm lazy and spent too many years in college, lol) and am thinking of flipping a house once I graduate. I figure I will have the time and the money so I might as well try my hand at it. If I fail, then oh well at least I tried and I can get a real job right?.

I have 30k in cash, a 761 credit score, no debts, but no job lined up as of right now. I've been reading anything I can about flipping as I would like to do it next year once I graduate and I have the time. I live in jacksonville, fl and think I know the area pretty good in regards to which areas of town to buy in. From my own research there seems to be several decent foreclosed houses valued in the 90-110k range that are currently for sale around 30k.

Is 30k in cash enough to start flipping? Right now my only concern is that since I don't have a job, I won't be able to get a small loan to help me pay for any expenses related to cleaning up the house. I'm not trying to jump into this thing since I know its risky hence why i'm trying to do all my research now, so any advice or suggestions would be greatly appreciated. Thanks
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Old 04-11-2010, 04:42 PM
 
Location: NJ
17,579 posts, read 43,111,498 times
Reputation: 16209
Get a job first.
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Old 04-11-2010, 04:43 PM
 
930 posts, read 2,285,613 times
Reputation: 1000
"Get real job" had a nice ring to it. Let's do that first
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Old 04-11-2010, 04:46 PM
 
380 posts, read 987,310 times
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I bought in Summerlin, NV last year for 35K (condo), and sold for 55K, then came to Phoenix and got a TH for 22K. Cash is king in the condo market. The houses are getting bid up to whatever someone will loan them. However, if the house is trashed, it will be very difficult to get a loan. So, my advice is to get a nice condo, or a beat up house (if you are handy). You will be living in it, and the dividends are tax free and awesome. My place would rent for 695, but my hoa + TAX IS 200. It's well over a 20% dividend, and if I hold for 2 years--the profit from the sale will be tax free,
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Old 04-11-2010, 10:35 PM
 
Location: LA
103 posts, read 192,405 times
Reputation: 91
In FL, I think $30k is doable (that's considering the current market, as I don't know how the market will change when you graduate or decide to buy). But I think you can def make it happen men, depending on where you buy. I'm in NY so $30K is way too low to do a flip here.

But I think you're good, I mean it won't hurt to try..and if your cash isn't enough, you can always find someone to invest with you instead of having to deal with the banks. Find a partner and share the profits.
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Old 04-12-2010, 09:42 AM
 
Location: DFW - Coppell / Las Colinas
38,063 posts, read 42,609,982 times
Reputation: 47166
The magic question is can you afford to lose your $30k if something goes wrong ? The risk right now in your life may not be worth any gain.

In your situation I'd invest the money somewhere else or buy a home to lease out. Flipping houses has caused many a person to go broke.
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Old 04-12-2010, 12:28 PM
 
2 posts, read 40,580 times
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thanks for the replies, I appreciate it. And yes I can afford to lose 30k right now in my life, which is why I am thinking of doing this now and not later in life when what for whatever reason I might not be able.

However nobody has answered my original question, how much cash did you start out with on your first flip? If 30k is not enough, what is? 50K?
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Old 04-12-2010, 02:01 PM
 
3,020 posts, read 7,887,507 times
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$100K. We paid cash for the home as it gave us more clout with the owner (FNMA). I'd advise that you get professionals to help you with the cost of rehabbing, updating, or repairing the home, since THAT cost can quite easily be equal to or even greater than the sales price of the home itself. Esp. for foreclosures.
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Old 02-17-2012, 08:48 AM
 
Location: Moving to the Cape NOW!
2 posts, read 19,848 times
Reputation: 11
Quote:
Originally Posted by mellowfe View Post
Hello everybody, well I'm 26, about to graduate from college this dec (spent 5 years in the navy prior to starting school for those of you thinking I'm lazy and spent too many years in college, lol) and am thinking of flipping a house once I graduate. I figure I will have the time and the money so I might as well try my hand at it. If I fail, then oh well at least I tried and I can get a real job right?.

I have 30k in cash, a 761 credit score, no debts, but no job lined up as of right now. I've been reading anything I can about flipping as I would like to do it next year once I graduate and I have the time. I live in jacksonville, fl and think I know the area pretty good in regards to which areas of town to buy in. From my own research there seems to be several decent foreclosed houses valued in the 90-110k range that are currently for sale around 30k.

Is 30k in cash enough to start flipping? Right now my only concern is that since I don't have a job, I won't be able to get a small loan to help me pay for any expenses related to cleaning up the house. I'm not trying to jump into this thing since I know its risky hence why i'm trying to do all my research now, so any advice or suggestions would be greatly appreciated. Thanks
Hi Mellowfe,

Yes, 30K should be plenty to start you off flipping houses. There is a considerable amount of information available online, not all of it good and much of it expensive, that is nevertheless very informative. Save your money to sustain yourself while you pick up a little information and experience. There are Hard Money Lenders and Transactional Funding that is available so you won't risk any of your own capital.

But they will only lend you the money if the 'Deal' is right, that is if you can secure a property that you can negotiate at 65% or lower of the Retail ARV, (After Repair Value). Many of these properties are 'distressed' properties that have fallen into disrepair for one reason or another, i.e. foreclousure, probate, age, or whatever.

If you are lucky enough to find one of these properties you can then make an offer to the owner or realtor through an 'Assignment Contract', and spend the next 30 days or whatever your inspection period of the property is marketing the property to different investment buyers for 5K to 10K profit.

But information about market values in your target area is KEY. Do a little research, I have found a wealth of inexpensive and free information online. Look up Freedomsoft, they have a trial period where you will be able to learn a lot from Than and Ely for nothing as long as you cancel your membership before the trial is over. Also check out Lex Levinrad, his information is both actionable and to the point, unlike many of the sites that will feed you a bunch of fluff while they promote thier overpriced products and mentoring programs.

Good luck to you, and I hope you got this before you blew you're cash on some shyster.

Sincerely,
BirdDogDan
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Old 02-17-2012, 09:26 AM
 
Location: Tempe, Arizona
4,511 posts, read 12,757,820 times
Reputation: 2199
Just noting that this thread is almost a year old, so advice may no longer be relevant to the OP. For new posters, it's helpful to check the original posting date located in the upper left corner of the post.
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