House flipping sounds simple enough, right? You buy a house at a low price, fix it up quickly, and resell it to make a profit. There are even seminars that claim to show how the average consumer can flip houses successfully and turn a profit. These seminars, often sponsored by someone that has a popular house flipping television program, may claim there is little to no risk in the investment process. Consumers can generally attend these seminars for free, however once there they are offered more in-depth training for a fee.
If you are considering attending a house flipping seminar, remember the following tips:
Many times the initial seminar is a sales pitch for another more in-depth program. You may be given some baseline tips that leave unanswered questions.
Don’t fall for high-pressure sales tactics. Remember, if it’s a good deal today then it will still be a good deal tomorrow. Don’t make any decisions on the spot.
Review the contract thoroughly. What is the company's refund policy? Are there any written guarantees?
In an unstable housing market your flip may not sell quickly. If you didn’t pay cash for the home you will be responsible for the mortgage payment until it sells.
If the home you purchase has code violations, you must make those repairs to avoid fines. Beware that many foreclosed homes have unseen damage that could leave you holding the bag on thousands of dollars worth of repairs.
Consider all of the risks and talk to your tax advisor.
Check out a company with BBB before doing business. Be sure to check out a company’s BBB Business Review, rating, and complaint history. BBB Business Reviews can be found at www.bbb.org.