Real Estate investment - Buying foreclose houses and fixing them up

[LuckyTaxi]

I posted a thread earlier about my plans to buy foreclosure houses and fixing them up then selling them for profit. My only dilemma is taking on a partner (my co-worker), but he's an a$$ and likes to jump into things before researching about them. Anyways, I'm thinking about going into this solo, but I know nothing about fixing houses. I'm going to obtain a loan where they actually give you money to fix them up and then pay them 6 months after you secure the loan. I figure I could buy a property then have 6 months to fix it and then sell it for profit. Pay off the folks who lent me the money and keep what's left over.

Generally, let's say the house needs a new kitchen and new bathroom. Besides that, a fresh coat of paint and maybe some minor patch work to the wall. I would hate to hire a contractor who will try to take me for a ride, but it's the price we pay for doing business with some of these jokers.

 

[DaVortex]

. I'm going to obtain a loan where they actually give you money to fix them up and then pay them 6 months after you secure the loan

what kind of loan is this, i never heard of it

 

[LuckyTaxi]

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[astroview]

If you think your partner is rash, I wouldn't go into business with him. Usually that's a one way road to disaster! And if you do, write out a contract! Setup a corporation or partnership.

From what I've been told, when buying a house at a foreclosure you generally need 10 to 15% of the money at the foreclosure and you have to pay the balance within a short period of time. Good luck getting this money, it's possible but the interest rate might be relatively high.

 

[Armitage]

I don't know anything about buying @ foreclosure, but I doubt you'll be getting it at to much less then market value. If you're going to contract out to do the fix-up work, I'm guessing your profit margins are going to be very very thin. Considering the cost of doing business ... fees, interest, etc. ... well, good luck.

 

[Jzero]

Originally posted by: ergeorge
I don't know anything about buying @ foreclosure, but I doubt you'll be getting it at to much less then market value. If you're going to contract out to do the fix-up work, I'm guessing your profit margins are going to be very very thin. Considering the cost of doing business ... fees, interest, etc. ... well, good luck.

Yah, I think you need to either know how, or partner with people who can do the rehab work for less than the "retail" price. Having to pay contractors full price is going to slow you down a lot, I imagine.

Perhaps you can find local contractors who will agree to provide you discounted rates in exchange for hiring them as the exclusive contractor for that work on any property you buy.