6 Steps to Flip a House Using Hard Money Loans

Flipping a house for profit using a hard money loan, in its simplest form can be broken down into a 6 step process.  If you play your cards right and follow a simple system you can make thousands of dollars every time you flip a house and do it in 3 – 6 months.

STEP 1: FINDING A PROPERTY

6 Steps to Fix and Flip a HouseI’m not going to sugar coat it, the first step is the most difficult and time consuming.  Here are a couple of tips to get you onto step 2.  If you’re new to the Real Estate industry than I recommend consulting a Realtor.  Leverage someone else’s expertise until you become an expert yourself.

Educate yourself on the real estate market in the area you’re investing.  The ideal marketing conditions are fairly bearish, in simple terms this means there’s a high demand for real estate.

Last, you’re looking for a home with room for improvement; worn carpet, a distressed yard, and other things that can be repaired with little money and a little sweat.  Look for a home where the average family in the area would be able to afford it.  It will sell the fastest.

Flip a House means you’re moving quickly!

STEP 2: EVALUATING THE PROPERTY

Once you think you’ve got a property that meets the initial criteria for being able to easily fix it and flip a house you need to do a thorough evaluation.  You’re evaluating the property for two things:

  1. Property Condition – Bring in an inspector, an expert that can determine if there are any major problems.  Get a firm bid from contractors and go into it with your eyes wide open.  Don’t fall in love with the property, do your due diligence.
  2. Property Price – Look for comparables, active listings and recently sold.  For both active listings and properties that have recently sold, start with looking at the lowest price comparison.  Start with the least expensive and work your way up.  Don’t over value the property.

STEP 3: APPLYING FOR A HARD MONEY LOAN

You will need to get a loan that is at least thousands of dollars more than the property.  The advantage of a Hard Money Loan through DoHardMoney.com is that the focus is on the merits of the deal and less to do with you credit history, available funds, etc…  Not all Hard Money Loans and Hard Money Lenders are created equal.  For a comprehensive breakdown on Hard Money Lending refer to our homepage DoHardMoney.com.

STEP 4: REHABBING THE PROPERTY

If you’re working with contractors put them on a strict time line.  Be very specific in each bid – I recommend that you type the bid out yourself.  Make sure there are no surprises for you or the contractor.  In your agreement with the contractor, put in a bonus if they get the work done early and a deduction if they take too long.

STEP 5: RE-EVALUATE THE PROPERTY

With all of the rehab work done, the next step is to re-evaluate the property.  This should mirror step 2, the initial evaluation.  Be sure your evaluating for both Property Condition and Property Price.

STEP 6: LIST THE PROPERTY FOR SALE

As I mentioned previously in Step 1, leverage the expertise of others.  List it with an agent.  And just as important, list it for what the properly is truly worth based on the evaluations.  Don’t inflate the price with the idea of it being negotiated down.  Time is a major factor; you can’t sit on the house for a coupe of years.  Get it sold as quickly as possible.

Follow these steps and you’ll see the results you’re looking for when you Flip a House using Hard Money Loans!

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2 Responses to “ 6 Steps to Flip a House Using Hard Money Loans ”

  1. david cech Says:

    Seems interesting no one wants to do small deals. Under 100k and people just run from you like you have a contagious disease. I am looking for a HML that makes under 100k loans and does them based on the property value not the borrowers credit. Do you have clients that make these loans?
    I just am not really interested in doing a 500k+ property right now when the micro deals have much better returns. I am currently buying a 4 unit apt building and paying 24,000 cash for it. Imagine 1700 in rent from 22k and No one wants to make this loan. I will be stuck doing owner financing at 26k but it would be nice to pay cash and get it for 4k less then the owner financed price would be. Either way this deal is done but I looked around realizing the hml out they advertise but just arent really lending? I guess eventually a few more deals like the one I am doing and I wont need a lender at all. I already own property free and clear and yet bad credit doesnt allow me to use my equity. I can pay 18% but if I am doing a duplex that costs me 5k to buy and I have all the materials already for the rehab do to other construction projects maybe your company knows someone that does micro loans. I need hard money for 24 months max to finish project.I would like to borrow 5k to 30k with 20% down and can pay 18% interest. I am in Indiana in Evansville metro area of 350,000 people with colleges and hospitals, casino riverwalk on the Ohio river and some heavy industry to include Bristol Meyer Squibb, Toyota and Meade Johnson.
    Thanks for looking Sincerely, David Cech 812-266-1250

  2. leszek Says:

    I need $250000 ,to buy,fix and flip i# 2018036666 leszek

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