Why Arizona Fix and Flip Loans May Be Key in Winning Bidding Wars

The general rule with rehab properties is not to get into a bidding war at all. At the same time, leveraging Arizona Fix and Flip Loans is one of the many strategies that can help you come out on top.

Getting into a bidding war when you’re trying to purchase an investment property, with or without Arizona Fix and Flip Loans, is almost always a bad idea because it often signifies that you’re emotionally invested in the property. It’s hard to make sound business decisions when you’re attached. However, there are times when paying a bit more won’t derail the profitability of a rehab and, in these cases, knowing what strategies work, and what doesn’t, is essential.

The latest research shows investors can boost the odds of coming on top by leveraging one of three strategies. For a 20% boost in odds, investors can agree to waive the financing contingency, removing their ability to back out of the deal if funding for the purchase doesn’t come through. Back in 2016, this was actually good for a 58% boost, a sign that what’s important to sellers is shifting.

Meanwhile, writing a personal letter to the homeowner is good for a 59% boost; up from 52% a few years back. Experts say it’s important to leverage some kind of personal connection you have with the property, given that many people have attachment to their homes.

All-Cash Offers Make Sellers the Most Eager to Do Business

At the end of the day, agreeing to pay cash for the deal increases the odds of an offer being accepted by 206%, up from 97% in 2016. While Arizona Fix and Flip Loans are technically not cash, they offer many of the same benefits of a cash deal. For example, they close in a matter of days versus the weeks or months of a conventional loan, which means the seller’s not stuck waiting on financing. They’re also the ideal option when a home is in disrepair or uninhabitable. Many sellers erroneously believe that a buyer with cash is the only one who can overcome these hurdles. It’s important to be clear that you don’t have cash when you’re making an offer, but educating the seller on how hard money works, and how similar it is to getting a cash offer on their end, can help seal the deal.

You won’t increase eligibility by skimping on diligence.

What doesn’t help? Skipping inspections, the experts say. Sometimes sellers will try to make the sale go smoother by having a pre-inspection, while buyers may agree to waive an inspection contingency if they think others placing bids will do the same. These things don’t change the odds of winning a bidding war. However, by touching base with lender on Arizona Fix and Flip Loans before talking to a seller, the odds can skew in your favor exponentially, allowing you to leverage both the “cash” offer and financing contingency strategies. If you can make an emotional plea via letter, you’ll be in an even better place.



Dennis Dahlberg
Broker/RI/CEO/MLO
Level 4 Funding LLC
Hard Money Lender
Hard Money Loans
Hard Money Loan
Arizona Tel: (623) 582-4444
Texas Tel: (512) 516-1177
Dennis
Dennis Dahlberg Broker/RI/CEO

NMLS 1057378 | AZMB 0923961 | MLO 1057378
22601 N 19th Ave Suite 112 | Phoenix | AZ | 85027
111 Congress Ave | Austin | Texas | 78701

About the Author: Dennis has been working in the real estate industry in some capacity for the last 40 years. He purchased his first property when he was just 18 years old. He quickly learned about the amazing investment opportunities provided by trust deed investing and hard money loans. His desire to help others make money in real estate investing led him to specialize in alternative funding for real estate investors who may have trouble getting a traditional bank loan. Dennis is passionate about alternative funding sources and sharing his knowledge with others to help make their dreams come true. Dennis has been married to his wonderful wife for 43 years. They have 2 beautiful daughters 5 amazing grandchildren. Dennis has been an Arizona resident for the past 40 years.

© 2016 Level 4 Funding LLC. All Rights Reserved.
Copyright | Privacy Policy | *Terms & Conditions

Leave a Reply