Flipping Houses Using Other People's Money.
???How do you find the right funding sources??There’s money all around you.?There are people who have 401ks, that have jobs.?If you’re in other countries, it’s similar.?It’s your qualified plan.?That’s part of your employment.?They’ll let you borrow up to $50,000 of your own 401k money.?So, if you are engineer, a doctor, whatever you are, I can promise you, your fellow employees all have money that you could be borrowing from them.
???And right now, a good interest rate that you could pay other people’s money is 10 maybe 12 percent interest.?More beginners might even take 9 percent.?More sophisticated folks are going to take the thirteen to fifteen percent.?But there’s money everywhere.?401ks are great lenders, alternative lenders.?There is so much money on the sidelines, sitting in cash, because people are not liking the crypto, NFT, and stock market right now.?So, there’s tons of money that is available.?Just hard money lender in general.?Look them up in your area.
????If you really want more sophisticated money, come on into our community.?We have people who are millionaires, on their way to being millionaires, hundred thousand-aires, who are borrowing money.?So, we’re teaching them to be a hard money lender.
????Hard money lenders, which is what I am.?I love putting my money out to you, and mine is 12 to 15 percent.?But I get first position, which means, if you screw up the asset, the project, flipping of the house, I get the house.?Because I know how to flip it, and I know how to sell it.?So, what’s the worst case for the lenders if they’re first position??I get the property because you didn’t do it right.
????There are a lot of private equity firms, hedge funds, those take a little while.?You’re going to need a bigger resume’.?For a lot of you that are just starting out, and want to use other people’s money, it is your friend and family’s money.?That’s the easiest money to get.?Or it’s your co-workers that have big 401ks that you can go get from them.?There are trillions of dollars sitting in 401k money that are not invested or invested properly.?A lot of them will cash in or do it differently if they know they could have a successful project, working with you and flipping properties.
?????Funding sources, in general, that can give you zero percent financing, for up to 21 months.?We have a variety of those sources.?In fact, one of our sources has over 500 lenders that can make you fundable.?So, if you become a client of ours, go to this link https://askloral.com .?We can fund so many people, and you don’t need a great credit score.
????Let’s just say you totally blew your credit, then what could you do, and you don’t want to do the real estate, but you want to get in??What you could do is find somebody who has good credit and has money, put them together, and go find somebody who’s flipping.?So, a lot of this deal making happens by who has the assets.
????And you say, what are the assets you need in flipping??Somebody needs the flipping experience.?Somebody needs the money management experience.?You’ve got to have the credit potentially, if you’re actually going to refi at the end.?So, you’re going to need a team around you.
????How do you find a strong investment team??First of all, who’s already done it??I’ve done hundreds and hundreds; I’ve had thousands of real estate transactions.?But to have me on your team, you’ve got to come all the way in and become a client.?Because I’m going to make sure you are corporately structured, your trust is structured, your insurance is structured.?All your operating agreements are structured.?I want to make sure you’re solid before giving you any of my money.
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????Which, by the way, that’s pretty standard for both hard money lenders and more formal lenders.?You’re going to need to have a strong financial team.?They’re not just handing money to some beginner, who has no resume or portfolio.?No properties they’ve ever worked on.?Having a good credit score, that’s kind of a myth.?You have to have more experience.?Money will follow management and experience and success.
????It is not difficult to raise capital for, not only flipping projects, but any project.?If you have a good track record of being able to take money from investors and pay them back, that is a bigger deal than most of you think.
????How do you develop a strong flipping strategy??We are in a really, really different time, because we’re about to go into a really big, what’s called a high-level foreclosure market.?Which means everyone in 2000-2001, that overbought their house, had a variable mortgage, or didn’t pay their mortgage, went to forbearance.?A lot of the financial institutes are going to straighten that up in the next months and years to come.?Meaning a lot of people are going to be forced into foreclosure, or having to hand you their house, of which they can then become the bank.?Which is what I’m looking forward to.?I’d love to hold somebody’s not for $300,000, become the bank, and you pay me, instead of the bank, your mortgage payment every month.
????So, notes are going to become a thriving business.?Do you want to flip them??Could you flip notes??Could you potentially flip properties??What is your flipping strategy, given the current environment of the recession and high-interest rates??And the biggest thing, also, is to notice your area, and every area is so different right now.?What are your construction costs and material delivery costs??You’ve got to have a really good financial analyst team to analyze.
????You may be able to do a really good buy on the property.?But once you have all the labor and material, additional costs and accelerated rates, it might not be as profitable as you think.?Anyone who is going to lend you some money, whether it’s a hard money lender, or somebody on a zero percent financing team of ours, you’re going to have to have strong financials, and a strong team.
????The top processes of due diligence are, what are your money rules??And do you have congruent money rules??Meaning, are you just flipping because you want to flip??Are you going to flip, buy, and hold??What is your real strategy and understand that.?Be able to talk about it.?if you want someone to give you money, you have to be able to talk about your strategy.?What’s your extra strategy??You have to, again, know your numbers.
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