Flipping a home is the process of purchasing a property—often
one in a rundown condition—then improving its value and reselling it for a
quick profit. Quick is the key word in
this strategy, since a fast turnover allows capital to be devoted to purchase
and renovation rather than operating and maintenance costs. It’s why successful
house flippers generally focus on quick gains over maximizing profits.
While this has proven to be a lucrative strategy in the
past, financing has always been the first major hurdle for anyone flipping a
home in CentennialGreenwood
Tree . If you’ve been noticing some of the inviting
house-flipping prospects in Denver , several financing routes sometimes make such
a deal possible:
Down Payment Flipping a house in CentennialGreenwood
Tree in the current
lending market will often require a significant down payment. Since launching
the project might require at least 25 - 40% for financing, it’s essential that
you prepare sufficient cash reserves to complete the renovations envisioned—and
successful house flippers suggest you add
20% to the cost estimate!
Financing Seller financing—a mortgage provided by the home owner—is
also called a ‘purchase money’ mortgage. Sellers may be willing to provide
financing if they have had trouble selling their property, which is often the
case when a CentennialGreenwood
Tree home flipper believes
its value can be greatly enhanced by repair or remodeling. Seller financing
would be more common were it not necessary that the original owner own the home
Loan Hard money loans—also known as short-term bridge loans—are
another common source of financing for flipping a home in CentennialGreenwood
Tree . Hard money loans are backed by the value of the
property rather than the credit record of the borrower, and typically feature a
lower loan-to-value ratio than found in a bank mortgage. The added risk has a
cost: expect to provide a large deposit and a premium for the loan (often 10% or
While sub-prime mortgages may no longer be as readily
available as they once were, there are still multiple sources of financing for entrepreneurs
who can spot profit possibilities for flipping a home in CentennialGreenwood
Tree . With real estate prices continuing to rise, this spring again
holds promise in the house-flipping arena. Call me if you are interested in learning
about some of the latest prospects!
Curious what your home is worth? Use our FREE online
valuation tool Click Here!
Jason Peck is a Broker
Associate at Keller Williams. He has been recognized locally and nationally as
in expert in real estate. Locally he is 6th in Denver Metro home sales out
of 5,000 agents and has been recognized by the Wall Street Journal and Real
Trends as one of the top selling agents in America. He is co-author of
the National Best Selling Book, “The New Rise in Real Estate”. For more
information feel free to contact
himor call 720-446-6301.
Real Estate Rebound Makes Flipping a Home
Attractive Again by Jason Peck Photo provided by www.freedigitalphotos.net
Author:Jason Peck Phone: 720-446-6301 Dated: March 10th 2014 Views: 3,889 About Jason: ...
Recognized as a top selling team in Denver Metro area. Nationally recognized for homes sold by the Wall Street Journal, Real Trends and Top 5 agent by RIS Media. Our goal is simple and that is to exceed our client's expectations by providing professional service, expert advice and exceptional results.
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