Description

I am a former school teacher who decided to start investing in rehab projects just a few years ago. Full of enthusiasm but little knowledge, I plunged ahead.

I had read about finding bargain properties from bank REO departments, so that’s where I began my search. Unfortunately, I was given the runaround with each bank I called. Finally, after several weeks of frustration and no progress, I hit upon and idea—-how about checking with the finance companies? Sure enough, several had REO properties that they were dying to get off the books and they were willing to accept just $100 for a 60-day option purchase.

At the time, I had not learned how to tap in the world of private mortgage lenders. So, with lots of ambition but no money, I decided to try to “flip” these properties to other investors. On the first deal, I found a three-bedrom, two-bath fixer upper that I got for $18,000, all cash. I next ran an ad and within three days sold the property (actually sold my option) at $24,000 for a quick $6,000 profit. Encouraged by my success, I found another property through a finance company. This was a three bedroom, one-bath brick house that needed a lot of work. I bought the house (on a 45-day option contract) for $10,000 and quickly sold it to another investor for $17,600—a nice $7,600 profit!

Since these early successes, I recently found a couple of private mortgage brokers in my area. I now have four properties under contract that I located through finance companies and plan to devote myself full-time to the rehab business. With the availability of financing in place, I have found my niche and I’m off and running.