Thursday, August 31, 2006
Mortgages and Flipping Houses Initial Post
Just thought this may be a good forum for inspiring house flipping folks, as I've done tons of it myself, and finally purchased my dream home. I started doing this in 1990, and bought my first house in 1992. Since then it's been a constant persuit, and, well, 5 houses later, I'm condemplating just living in my house and working.
Another thing I'll be addressing and talking about is mortgages. Getting home loans is really a pain in the butt, however absolutely crucial to moving up in the world (and in net worth)
Adding to this post now, as I'm noticing that as I talk to people, they really don't understand the remodeling process. I just talked to my friend the other day, and he just had his house insulated, and told me he was about to call the electritian. I told him that he needed to do all of the steps in order, and that way the contractors wouldn't hate him. He of course didn't understand, but it's really important, like in this case if you have your walls full of insulation, then it's really hard for "SPARKY" to run wires, and drill holes in 2x4's. Ssooooooooo with that in mind, I want to publish a list of the order in which you want to do things, which will save you time effort, and FRUSTRATION!!!
1) APPLY FOR A HOME LOAN, MORTGAGE, OR REFINANCE YOUR EXISTING LOAN!
You need money to do your project, and starting your project without the proper financing can be deadly, costly, and could also cause you to loose your most valueable asset - Your HOUSE! Having the cash to do your project will also allow you to pay contractors the deposit, shop for materials, take advantage of specials, discounts, and most importantly give you peace of mind, and allow you to SLEEP AT NIGHT!!
2) PLAN YOUR PROJECT TIMELINE, AND CREATE A BUDGET!
Knowing how much you expect to spend will give you an idea of how much to borrow, and will also help you qualify your build or remodel so that you know if you can afford it to begin with. Also keep in mind that your project will 9 times out of 10 cost DOUBLE what you anticipated, and take TWICE AS LONG!!! With this in mind, you'll be able to move forward with confidence, have almost enough dough to get the project done, and know that it will take much longer than you expect.
I'm going to give myself some ideas so that I don't forget for my next post - make money at work- save money on your project
get it done right the first time
don't pay contractors 'till it's done
have contractors give you a COMPLETION DATE
have contractors tell you how much you'll be credited for each day they put you behind schedule
hire qualified help
don't do the demolition yourself unless you're really poor
don't have friends help, unless you're providing free beer
make sure you do tests to an existing house before you buy (turn the water off inside the house) or prepare to learn the hard way
don't make concessions on the purchase contract because you feel "good" about the seller
more to com3e.l......................
Hope to ski this season