House flipping which is also referred to as wholesale real estate investing is an investment strategy that not all investor lays their hands on because even the most simplest and smallest mistake can ruin everything and things can have a drastic effect. This article Zack Childress review about house flipping mistake is going to be a blessing for all realtors who are planning to lay their hands on house flipping. Now, let us have a look at the pitfalls.
• Lack of money: trying your hand in real estate is a risky affair and the very first expense is the acquisition cost. Finding such deals from legitimate vendor is no easy thing, so research the financing options and settle on which mortgage type best suits and stumble on a lender that offers low interest rates. Even though you may leave a sigh of relief thinking about the interest on borrowed money is tax-deductible, commit to memory that it is not 100% deductible. Explore the available financing options extensively and find a lender that offers low interest rates. You can make use of a mortgage calculator that makes things easier for you and the best part about this tool is that it allows you to judge against the interest rates offered by various lenders.
• Failing to foresee the value: A smart approach is a must when it comes to evaluating your foreclosed home and that is, your approach for the transaction long-term instead of transitory. This is because a foreclosed home may decline further in value. Well, if the hope of flipping the property and reselling shouldn’t go in vain, then you got to consider crunching the numbers, else you may have to undergo long-term financial repercussions.
• Skipping inspection process: This is one of the deadliest mistakes that you can ever do. Survey says that 72 percent of U.S. homeowners agreed with the home inspection and it had helped them avoid potential problems, on the other hand, people who have skipped the inspection process has experienced a severe downfall. Having said that, during this process it is good to team up while the assessor or the inspector is looking at the property. Ask questions take notes and do whatever is necessary, an amount of $300 to $500 is charged for this service, but this service is definitely lifesaving, so by no means, try to skip it.
• Not doing your research or spending less time: be it renovation or house flipping, both are a taxing business venture and depending upon the size of the property, it might months or days to find and buy the right property. Once you own it, you need to spend enough time to fix things up. Scheduling inspections, checking for building code compliance are a few to mention.
You should move toward house flipping as a business moreover, just like any other business flipping a house is a venture which takes in a lot of time, money, planning and patience and skill and research. Harder than you imagine, taking things lightly will risk the whole process and most importantly if you are looking to get rich quick by flipping a home, you could end up in the poorhouse, so make sure that you do your research and spend enough time in executing what you have planned such that the whole process ends up in the way it’s meant to be.