Home Buyer's Recession Survival Guide - Obtaining Flipping Money

Flipping houses is the most tried-and-true way to make a fortune in real estate... Tackling one of the most exciting aspects of today's high-stakes real estate market - the transformation of an eyesore into a profit-making beauty... a team of characters buys homes, renovates them in record time, then flips them for a profit...

- A&E Network's description of "Flip This House"

With house flipping television programs taking over the television screens and dazzling the minds of an entire generation of house flippers to be, it was inevitable that they would head out in droves going street by street trying to find old beatup houses that they can put in sweat equity, turn into elegant mansions, and just like their heroes on television, pocket huge profits. The biggest problem that these droves of wannabe flippers face is: How do you get the Mortgage?

The majority of the junior ankle biter wannabe flippers are not wealthy, or at least not yet, so the funds to pay for the renovations has to come from somewhere. If the would be flipper is dreaming of a contractor that will extend credit until the flip is complete and the house is sold, then they can just keep on dreaming!

Mortgage money is the only real way to get a flip off the ground. There is no way that the Mortgage lender is going to agree to simply fund the cost of the property plus the cost of the renovations plus the cost of carrying the property until it's finally sold.

There is going to be a schedule of draws against the various costs involved in the renovation until the work is finally done. The contractor that is going to be doing the work must be certified so that the lender can rest assured that the renovations are going to be taken to a predetermined stage where the next tranche of money is going to be released.

If enough equity exists in the property, then the lender, broker or banker can roll the whole kit and kaboodle into the mortgage. What that equals is peace of mind in knowing that during the term of the renovations there will not be a requirement to make a monthly mortgage payment, and that can be an overwhelming advantage to any novice residential property flipper!

Also keep in mind that flipping a house, especially in the currently precarious economic times, is no where near as easy, foolproof and guaranteed to turn a huge quick profit like those home flipping adventures you may have seen on television. It is currently exceedingly difficult to turn a profit in flipping a house in the vast majority of real estate markets in North America, and there are only a strictly limited number of properties which are suitable as the rules have certainly changed in the last couple of years.

Don't get dazzled by the prospect of picking up a house in suburban Detroit which was listed three years ago at $150,000 and is now available for one tenth of that amount. First of all the majority of these houses have been profoundly trashed and will require an overwhelming amount of work before they are habitable once again. Even if you do find one in good shape, keep in mind that Detroit is being decimated and the housing stock in the city and environs is completely out of proportion to the current population, let alone the vastly diminished population in the near future. There is no bargain available in Detroit or any of America's other ravaged cities if you end up losing money or much worse, end up getting stuck with a property that can't be sold or even rented out. Be careful out there! It's a dangerous real estate world!

Read The Entire Survival Guide

Home Buyer's Recession Survival Guide - The Subprime Meltdown
Home Buyer's Recession Survival Guide - The Advantage Of Renting Over Buying
Home Buyer's Recession Survival Guide - Why Rent? Why Not?
Home Buyer's Recession Survival Guide - Five Common Mistakes House Buyers Make
Home Buyer's Recession Survival Guide - Get Your Home Sold Quickly & At Your Asking Price
Home Buyer's Recession Survival Guide - Improve Your Home's Value And Sell It For More!
Home Buyer's Recession Survival Guide - Learn The Value Of Curb Appeal
Home Buyer's Recession Survival Guide - Home Staging: Valid Selling Technique Or Fraud?
Home Buyer's Recession Survival Guide - Before You Go House Shopping
Home Buyer's Recession Survival Guide - The Home Condition Checklist
Home Buyer's Recession Survival Guide - Getting A Mortgage From Different Types Of Lenders
Home Buyer's Recession Survival Guide - What To Do After You're Turned Down
Home Buyer's Recession Survival Guide - New Initiatives To Help Get You Approved
Home Buyer's Recession Survival Guide - Isn't HUD An Old Paul Newman Movie?
Home Buyer's Recession Survival Guide - Jumbo Isn't As Huge As He Once Was
Home Buyer's Recession Survival Guide - FHA Q&A
Home Buyer's Recession Survival Guide - The FHA's Credit Requirements Vs. The Bank's
Home Buyer's Recession Survival Guide - Your Credit Score And Your Mortgage
Home Buyer's Recession Survival Guide - Credit Score Confusion
Home Buyer's Recession Survival Guide - Keeping That Credit Score Nice & High
Home Buyer's Recession Survival Guide - Minimize The Interest Payable
Home Buyer's Recession Survival Guide - What Is PMI & Why Do I Care?
Home Buyer's Recession Survival Guide - The LIBOR-COFI-COSI Alphabet Soup
Home Buyer's Recession Survival Guide - REO: Get Rich Quick Or Just Waste Time?
Home Buyer's Recession Survival Guide - Obtaining Flipping Money
Home Buyer's Recession Survival Guide - Consider The Additional Costs
Home Buyer's Recession Survival Guide - What Is Escrow?
Home Buyer's Recession Survival Guide - Tips To Avoid Foreclosure
Home Buyer's Recession Survival Guide - The Changing Value Of Your Mortgage Dollar
Home Buyer's Recession Survival Guide - How To Ride The Interest Rate Spikes
Home Buyer's Recession Survival Guide - Can't Get A Mortgage? What A PITI!
Home Buyer's Recession Survival Guide - Calculating Your Closing Costs
Home Buyer's Recession Survival Guide - Mortgage Broker or Mortgage Banker?
Home Buyer's Recession Survival Guide - The Magic Of A Down Payment
Home Buyer's Recession Survival Guide - A Refinance Checklist
Home Buyer's Recession Survival Guide - Refinancing With Bad Credit
Home Buyer's Recession Survival Guide - The Self-Employed Mortgage Maze
Home Buyer's Recession Survival Guide - VA Loans
Home Buyer's Recession Survival Guide - Offset & Reverse Mortgages
Home Buyer's Recession Survival Guide - The Reasons To Not Buy An Offshore Retirement House
Home Buyer's Recession Survival Guide - How To Pay Less Than $500 A Month
Home Buyer's Recession Survival Guide - Five Easy And Cheap Tips To Save Big $ On Energy

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