I want to be a House Flipper.

I don't think the words "Credit Card" and "Saving Money" are supposed to be used in the same sentence. And/or they could be construed as an oxymoron.

I know... My parents raised me to never get credit cards. They thought rent, bills, etc. would be enough to build credit. When we met with our Real Estate agent/Friend she said that I absolutely have to built credit or I won't be able to get a loan on a home. Seeing as my car is paid off, she said I need to get a credit card (possibly more than one) right away. I know credit cards can be very dangerous, but I only plan on putting a few things on like groceries, my prescription, my rent (for at home) probably no more than 50 bucks a month. I just have to be responsible, pay it off on time, and always set aside money in my account for what I spend on the credit card. I have faith in myself that I can do this right.

-R

If you can do that, your off to a great start.

Good luck.

TrueSouthernPeach said:

I know... My parents raised me to never get credit cards. They thought rent, bills, etc. would be enough to build credit. When we met with our Real Estate agent/Friend she said that I absolutely have to built credit or I won't be able to get a loan on a home. Seeing as my car is paid off, she said I need to get a credit card (possibly more than one) right away. I know credit cards can be very dangerous, but I only plan on putting a few things on like groceries, my prescription, my rent (for at home) probably no more than 50 bucks a month. I just have to be responsible, pay it off on time, and always set aside money in my account for what I spend on the credit card. I have faith in myself that I can do this right.

-R

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I'm in the process of doing the same thing. Evidently paying all your bills on time isn't enough to get a good rate.

Paying off a fifty dollar credit card bill each month isn't the kind of credit that will get you anywhere my dear. Mortgage lenders look at your "high-credit" and what it was established for. Buying groceries is not out of the norm, everyone does that. If you want to get going go buy some furniture and finance it through the seller for a while then pay it off early by overpaying each month. Suggesting you use credit cards to establish credit is some very bad advice. There are other ways. Go to your local bank and borrow money on a ninety day note using your paid for assets as collateral. Don't spend the money, and inside of the ninety days pay off the note including interest. Do that a few times and you will quickly build a favorable credit report. The only time those credit cards mean anything with your credit report is when you either spend thousands monthly and pay it off monthly or when you land in the dumpers and they reflect negatively on your record. Credit cards are not the way to go. You should also be looking for a new realtor.

It's definitely great to get a second opinion! I wondered the same thing, too. Our realtor had mentioned there would be other ways I could try besides the card, but didn't mention them, we mainly talked about a card. Borrowing money from the bank is a great idea. Would it still be a good idea to get one credit card and use it sparingly along with borrowing money, or just avoid them all together?

Also... I got the job at The Hermitage! Right now they are going through a major restoration, and on Tuesday I get a free tour! I'm also allowed to roam the grounds when I want so I will be taking a lot of pictures and doing a lot of observing! ... I found out today that the huge majestic columns that hold up the roof are hollow and have tulipwood on the inside to hold it up... Sounds like cool stuff to me!

TrueSouthernPeach said:

Hello,

I'm a 21 year old female who would love to do house flipping. No, I am not interested because of shows I see on TV (Though I do like to watch them once in a while) I am interested because I love to work with my hands. I love the thought of doing something meaningful and my heart breaks when I see what was once a beautiful old house in shambles. I wouldn't want this to be a hobby, I would want it to be what I do... I'm ready to get the ball rolling in any way possible, but I have a few teeny, tiny little problems:

Though my father and his father have extensive knowledge on home improvement, and major renovations... My grandfather has passed on and my father is a very busy person. I need to learn everything about house flipping. From how to even do the work, to how to buy, sell, and everything in between... I know there are books out there, and classes at some places, but I would like to get more 'hands on' experience, I am just not sure how.

I don't have much money. I'm a cashier, and I am currently saving as much money as I can so my fiance' and I can move into an apartment closer to where he goes to school. My plan is to get a better job and try my best to save up as much money as I can while renting. I am not sure if this is the best idea, though. I have even thought about just living at my parents house a while longer (they wouldn't mind at all) and saving up enough money so I can skip renting and get right into a house to renovate... But I am not sure if that is doable.

I have been really interested in fixing up old houses for a long time now, but I could never think of a way to really get into it. The reason I don't go to college is because my passions are old-fashioned simple things like baking, gardening, and just doing things with my hands. I like the idea of doing honest work as opposed to sitting in front of a computer for a living, or being a cashier! I also work my best when I'm alone, I prefer it actually. I would also NOT be doing this just for the money. For me, I absolutely love old houses and love the thought of making them beautiful. I know it would be a lot of stress/work, but I am prepared to deal with it in any way I can to accomplish my dream.

Basically what I'm asking is: How do I get started? How can I learn/teach myself all of the complicated skills of house flipping? What is the best way to do it financially? What can I do to prepare myself mentally and even physically while I save money? Please don't discourage me because I'm a girl. My family and fiance' have already told me that this is not something I should get into. However, I am deeply, and truly interested in this kind of work.

Thank you for taking the time to read this!

-R

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Cool...I want to be a day trader...Any tips?


J/K My advice would be to get a job with someone who does what you want to do. That why you will get an education and make money.

this story keeps getting more lovely

It was mentioned before, but there is a difference in the emotion and good feeling of fixing up and restoring a house (typically like you want it, or feel it should be done) and fixing up a house to flip and MAKE MONEY. The house next door to ours was foreclosed on and the guy bought it for about half what I paid for mine. He just sold it after doing extensive clean up and remodeling and probably made $20-30,000. The remodeling was not what someone (or I) would probably do for our own house, but it was the cheapest and the fastest. Not bad work mind you just not what I would choose for my own house. It also took almost a year to sell.

The idea of buying a fixer-upper and doing the work on it while you live there is a good one if you can live with the dirty bathrooms and kitchens for awhile.

TrueSouthernPeach said:

It's definitely great to get a second opinion! I wondered the same thing, too. Our realtor had mentioned there would be other ways I could try besides the card, but didn't mention them, we mainly talked about a card. Borrowing money from the bank is a great idea. Would it still be a good idea to get one credit card and use it sparingly along with borrowing money, or just avoid them all together?

Also... I got the job at The Hermitage! Right now they are going through a major restoration, and on Tuesday I get a free tour! I'm also allowed to roam the grounds when I want so I will be taking a lot of pictures and doing a lot of observing! ... I found out today that the huge majestic columns that hold up the roof are hollow and have tulipwood on the inside to hold it up... Sounds like cool stuff to me!

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The main problem with a credit card is that no matter what you put on it, how long you hold it open, or what you use it for, it is only one item on your credit file. You could put $1000s on it every month and pay it off every month and it will still only show one item as being handled correctly. Also, credits cards affect your income/debt ratio which has to be less than 27% in most states in order to be approved for a mortgage.

The credit card is a good idea for someone who has good credit (which is very different than no credit) and just needs a little shove in the right direction. It is also the easiest credit to apply for and receive. That's why most realtors recommend it.

The best idea, if you are going to get a credit card, is to get the smallest credit card they will allow you to have (typically $100-$500 depending on the company). Then pay it to a $0 balance every month. After six to twelve months close it out. If you want, wait six months and then repeat the process.

While you are doing this, follow the advice about the short term loan. Something for nine to twenty-four months with payments that you can guarantee you'll never miss. An investment loan is sometimes helpful with this, because the money actually ends up in a term investment where you can't withdraw it until the term is over. Be careful to make sure that the investments chosen are little to no risk, meaning very small amounts of interest over long periods of time. The purpose of this loan wouldn't be the investment, but the loan.

In the meantime, get a small overdraft protection or recycled line of credit with your financial institution. Once a month withdraw enough money to put yourself into overdraft (or a random amount from the line of credit) and deposit the money two business days later. For overdraft protection to affect your credit the change must have at least one full business day, but two is safer. In other words, if you withdraw the money and put it back right away the bank won't even register that you've made a change.

Total process will take up to two years. At the end of the two years close every credit product that you have. Pay off all loans, request to have the line of credit removed, and pay off and close all credit cards. Every seperate loan, credit card, and overdraft product will show on your credit file. You can show up to seven before it starts deleting them. If you have seven credit products showing no problems and at least two or three going silmontaneously you will have an amazing credit score. However, keeping them open will screw your income debt ratio and you won't be given a house anyway.

In all things, don't bite off more than you can chew. A single payment made one day late can mess up the whole plan. If a single provider lists you as a "high risk" you may not be able to get a house until you can boot them off your credit file by using and receiving six new credit products.

Just raising your credit score can be hard enough work as it is, but then again... everything worth doing is difficult. Right?

With regards to credit card overall score, I saw this interesting awhile ago:

http://finance.yahoo.com/banking-bu...-hurt-overall-credit-score?mod=bb-creditcards

My wife and I have been in a new old home now for a little over a year now. There are stretches where we are working from the crack of dawn, till past dark. Exhaustion. Soreness. Lack of a life outside the home. We do it as a labor of love, being our own home, but I can't imagine doing this full time as a living. It's just too stressful!

TrueSouthernPeach said:

Hello,

. . .

Basically what I'm asking is: How do I get started? How can I learn/teach myself all of the complicated skills of house flipping? What is the best way to do it financially? What can I do to prepare myself mentally and even physically while I save money? Please don't discourage me because I'm a girl. My family and fiance' have already told me that this is not something I should get into. However, I am deeply, and truly interested in this kind of work.

Thank you for taking the time to read this!

-R

Click to expand...

These days, learning how to do short sales is the way to go.
Countless people are being foreclosed on. The banks are in *big* trouble for writing bad loans and have a real high motivation to make them good.

So, basically, you find a house where the mortgage is at or over the value that is in foreclosure proceedings (a 'Lis Pendens' in the public records). You locate the people in charge of loans in default. Then get the owners to sign a tentative agreement (contract).
You create a 'Short Sale Package' including information on why the owners can't pay, why the property isn't worth the loan, pictures making the property look *bad*, etc. and you present it to the bank (loan defaults).

If you're interested, go to the book store and buy a couple books on 'Short Sales'.

Somehow I wound up being the world's slowest house flipper. Didn't intend for it to be that way but a better situation would come up somewhere else in this great country, I'd have to sell. By that time, everything would be working, no more great problems hanging over my head, and I'd be looking forward to catching up on my reading and doing my hobbies.

I hope this time I stay put.

It is a nice feeling to make house your own though. I'm at two built-in bookcases and counting.

TSP:

My suggestion is to go out and get some hands on experience. Start with a Habitat House, see what it takes to build or remodel a building. Watch a house being built from start to finish. Remember that a remodel is always harder than a new house build. See what they mean when they say "up to code". You may even get hired on as a carpenters helper or a laborer on a residential construction job. Just remember there is no substitute for experience. Learn from the pros both the good and bad sides of construction. Even the pros will run over budget and always plan on extra unforseen costs. Look for someone that is doing a current flip and see if you can shadow or work for them to get a real life example.

You can do anything you put your mind to and good luck.