I’ve always said that wholesalers and fix and flippers should expand their horizons by getting into creative financing opportunities.
While I’m known as the creative finance guy, I do have businesses in wholesaling, fix and flipping, buy and holds, and others; however, I obviously do a lot of creative finance deals.
And because I do so many deals, my Subto students and others will always ask what is the most ideal situation that can use creative financing. And the answer I give is usually the same.
I know, I know – it’s not the answer people want to hear, but it’s true and the reason it depends is all about you, the person doing the deal and looking for the creative financing situation.
So how do you find that out?
3 Ways to Find the Most Ideal Creative Finance Situation
The most ideal creative finance condition is the one based on what you think the perfect deal is.
Every investor has a different idea of what that deal might be – maybe it’s a subject to home that you helped a seller with; maybe it’s a seller finance opportunity that will net a sizeable profit for you and the seller.
Maybe it’s finding a deal from a real estate agent or another wholesaler that you’ve grown a relationship with.
Whatever that ideal and perfect deal is for you, that’s your situation. But how do you get to that?
Be honest and ask yourself some questions
First and foremost, you need to ask yourself some questions when it comes to finding that perfect deal.
So many times, new investors will jump in and get overwhelmed because they’re doing a bunch of things without truly knowing what it is they want.
We call this ‘analysis paralysis’ – where you get so overwhelmed with information, you aren’t sure how or where to focus. When it comes to the type of deal you want to lock up, ask yourself:
What type of investor do you want to be?
How close do you want your first property?
Do I want to have a property manager?
Asking yourself these questions will help to narrow down the specifics of what you want to do and what you’re looking to do in terms of deals.
Cash Flow is your main focus
Think of cash flow as the meat and potatoes for your business.
Once you have the above straight away, you can start thinking about the location, such as a property that’s within a 1 to 2-hour drive to your own residence.
Another thing to look for is an area with a low vacancy and high rents. You might think this is counterproductive, but you want to look at areas that have a good amount of stability, including:
Close to schools
Close to large colleges or universities
Close to big companies
Close to downtown areas
Local crime heat maps are a great way to show you where problem areas might be, so you can gauge the location.
Getting deals from relationships
Lastly, one of the best ways to find creative financing conditions is through your relationships with others and by seeing what’s in the area you’ve chosen.
So for instance, real estate agents, of course, are one of the best resources of finding deals. They see and deal with a lot of homeowners, even if they aren’t able to list their property.
But these are the houses that we’re looking for because they’re distressed and a homeowner needs to sell as fast as they can. These deals usually look like:
These types of homes are ones real estate agents will avoid, but if you mention that you’re looking for these, they will let you know the details.
And guys, that’s it. Again, the most crucial part of finding your ideal creative finance situation is based on you and what you want.
If you have a plan in mind but aren’t sure how to start or where to start, then join our Facebook group and speak to our students for help, support, and guidance.
You can also use this Fast Pass application to see if the Subto course is the best fit for you and where you can get valuable information and resources.