How To Flip Houses With No Money and Bad Credit
Flipping Houses Without Using Your Own Money
Are There No Credit Check Rehab Loans?
Overcoming Bad Credit Or No Money House Flipping Hurdles
How To Start Flipping Houses With No Money Down
Flipping Houses With Bad Credit is Possible
Because we fund based on the equity in the property we can extend loans to those with less than great credit. This doesn’t mean that we won’t do a credit check however. We don’t check your credit as part of the enrollment process for Find-Fund-Flip, the system we’ve designed to help those with bad become successful real estate investors. We will pull credit when we extend the loan offer, just so that we know what interest rate you’ll pay and to assure you’ve been truthful with us about your credit history.
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Flipping Houses No Money
At Do Hard Money, we help people open the door to financial freedom regardless of their credit rating. Due to overspending or bad investments, or maybe just rotten luck, there are hundreds of people out there who seek to improve their credit score. Guess what? Investing in real estate helps improve your credit and you don’t need an impeccable score to flip houses. We want to teach you how to flip a house.
If you have bad credit, fear not! Repair the damage done and make thousands of dollars in profit. We’ll show you how it’s done. We can help you get started flipping houses with little or no money down. We work with borrowers with bad, poor or no credit, as well as those with good and great credit. We can even help you get started if you’ve never flipped a house or invested with real estate before! Let us show you how to flip a house.
Learning How to Flip Without Money Is a Key Component of Our Find-Fund-Flip System
A Quarter of Our Borrowers Need Less Than $2000 Cash To Close To Complete Their Flip!
Our Borrowers Earned an Average of More than $33,000 Last Year Applying The Tactics Learned
Enrollment Pays For Itself Time and Again!
Flipping Houses With No Money or Bad Credit, What is Realistic?
You see house flipping TV shows, late night real estate guru informercials and best-selling books touting the wealth making potential of house flipping. And for good reason. Real estate investment is a time proven way to obtain the financial freedom you crave. But you aren’t sure whether it will work for you because you have bad credit, so getting a loan seems improbable. Or perhaps you don’t have any money you can devote to investing, so you know a down payment is going to be a problem for you. Or maybe you are facing both problems.
Strategies For Becoming a House Flipper
One of the first things you will want to do is meet investors. Look for real estate i nvestment groups in your area and find some online resources. Keep in mind that free information available on the internet is not always reliable, or may not be applicable to your specific situation. And potential investors with bad credit but access to funds face different problems than those with good credit but no capital. And those facing both hurdles will need to devise even more strategies to flip houses, but it can be done.
Meeting people will be important for you, because one of the best strategies you can employ is to find a business partner. Perhaps you can find someone missing the resource you lack, either capital or good credit.
Flipping houses with no money does not mean that there are not costs involved, it means that you find ways to cover those costs without using your own money. The funding to complete the rehab investment will most likely come from more than one source.
We Can Teach You How To Find The Types Of Deals That Lenders and Investors Will Want To Fund So That You Don’t Need To Use Your Own Money
Find an INCREDIBLE Deal
One of the best ways to flip a property with bad credit or no money is to find a really really INCREDIBLE deal. Find the kind of deal which qualifies for 100% financing. The formula for finding 100% financing deals is simple:
Highly-desirable location + Low Property Purchase Price/Rehab Costs = 100% Financing Deal
They may be hard to find, but these deals do exist! Here’s a real life example of such a deal:
James F. found a fantastic property in a very popular neighborhood in Chicago, IL. It was a six-bedroom, two-bathroom home located on a quiet block, ideally close to schools, parks and transportation. This property was the eyesore of the neighborhood and nowhere near move-in ready. No one wanted to touch it, but James saw its tremendous potential. Therefore, he purchased it for an incredibly low price – only $25,000. He brought the deal to Do Hard Money, who calculated the ARV (after-repair value or selling price) at $133,000. Since the best hard money lenders lend at 70% of the ARV, we offered James a loan of $95,000. He purchased the home, performed the rehab and paid all closing costs, with $0 cash-to-close. Click here to see full details of James’ amazing story.
Thus, if you find a property in which the purchase price, rehab costs and other fees are included in the 70% of the ARV of a hard money loan, you’ve got yourself a great deal with a hefty profit and no need for a perfect credit score.
The best way to find such a deal is to take advantage of property evaluations. Do Hard Money offers independent, 3rd party evaluators to assess the value and profit potential of a property. They give accurate estimations of the property’s ARV and therefore, offer loan approval on qualifying properties. Even if you have bad credit and no previous flipping experience, you can still qualify for a deal!
Snag the Best Hard Money Loan
No Need to Be Afraid of a Credit Check!
Learn How To Wholesale Houses Without Money!
Flip Houses With No Money Down!
Since they don’t require a minimum credit score, hard money loans are the best way to fund your flip. Traditional real estate loans base their lending criteria on the borrower’s personal ability to repay the loan. They measure this ability by items such as personal earnings, debt to income ratio, and of course, your credit score. These items are intangible or “soft” assets. Hard money loans, on the other hand, base their criteria on the value of the property, or a “hard” asset. Therefore, having a bad credit score should never keep you from loan approval. This loan covers 70% of the ARV (after-repair value) of a property.
Though a poor credit score won’t keep you from loan approval, it does make the points and interest of a hard money loan a little higher. For example, clients of Do Hard Money with poor credit pay 6.5% in points rather than 5.5%. They also pay 1.5% interest per month instead of 1.25% (reserved for credit scores of 680 or higher).
Another obstacle you may run into is the hard money loan not covering all of the costs. As we discussed in the previous step, if you have a phenomenal deal which qualifies for 100% financing, you won’t have to worry about any cash-to-close or other gaps in financing. However, what happens if you bring a good deal to the table but the hard money loan can’t cover every expense? Remember, only 70% of the ARV is funded. If cash-to-close or other costs are required, you will need to get that extra money from somewhere.
Unfortunately, gap financing and an unsecured business line of credit are not viable options for those with poor credit. However, there is another excellent source of income of which you can take advantage and make your profitable deal happen! Just read on to Step 3…
How do you wholesale without using your own money? Do Hard Money can easily help. We have an entry-level solution for those wanting to break into fix-and-flip investments called Partner-with-a-Pro. To learn more or take advantage of Partner-with-a-Pro, click here.
Find and Work with a Business Partner
Though it’s difficult to get gap financing with a poor credit score, you can always work with a business partner to help make up the difference in your funding. If you have bad credit, no experience and no funds for cash-to-close, a business partner is the best asset to secure a hard money loan.
Be sure to discern the best from the worst when the time comes to choose your business partner. The kind of person you will want to partner with will be someone who offers the skills and resources which the deal currently lacks. For example, if you have time to look for profitable properties but lack the funding to make the deal work, the ideal business partner will have capital but may not have time to find properties.
Here are some major advantages to partnering with a professional:
- Create your fix-and-flip business with an ownership structure.
- Utilize your business partner as a gap financier.
- If you have bad credit, and your business partner has excellent credit, they can secure business lines of credit or primary loans for you. Then you can divide the proceeds in an even split after the property sells.
Try This Combo: Seller Carryback + Hard Money
This is an interesting alternative for those with bad credit. A seller carryback is a situation in which the seller agrees to being paid the majority of the property purchase price immediately and the remaining balance once the house is sold to the end buyer. For example, if a property costs $110,000, a seller carryback happens if the seller agrees to you paying them $90,000 right away and $20,000 later, once the house is sold.
This option is similar to partnering with a business professional, only you wouldn’t have to split any profits. In some cases, you can even find a seller willing to do this for no extra money nor interest fees. This is a far better option than using a gap financier, though the seller is at a potential disadvantage in waiting for their money.
*Please note: In some states, a seller carryback is not allowed. Be sure to research which states allow a seller carryback situation.
Bad credit? No credit? No problem! Take advantage of some fantastic REI opportunities out there, regardless of your credit history.
In addition to valuable information, Do Hard Money provides a specialized team of investment experts to help you get started, regardless of what level of REI experience you have under your belt. To find out more, click on this link to get started. A member off our team will help you take the next steps toward financial freedom and discover what to do to become successful. Looking to speak with a professional right away? Call us at 801-692-7703.
Flip Houses With No Money Frequently Asked Questions
You’re correct when you say we pull your credit report when giving you a hard money loan to flip houses. It is also true that a low credit score will not keep you from getting a house flipping loan. But the credit check will tell us more than just your score. We can make sure you’ve been honest with us about collections and bankruptcies. Those things won’t totally prevent you from getting your loan though, they just mean you will need to have a credit partner.
No. Once you close on the loan you will get 10% of the rehab funds to help you get started. This will allow you to do things like get the power turned on at the property. The remainder of the rehab funds will go into an escrow account, and as the work on the property is completed and passes inspection the money will be disbursed via our draw process. We will only release funds on completed work, and the funds will be released to the licensed contractor you will be working with on the rehab. If you are a licensed contractor the funds can be released to you. But if you are not the contractor you won’t get reimbursed for any of your own work on the property until it is sold.
Yes, you can if you are enrolled in our Find-Fund-Flip System. Because our direct funding is all asset based, and each deal will be set up with its own entity, you can get funding for all of your qualified deals.