So, you probably guessed I would move forward with this idea. Of course I have my reservations, but I can’t not try this. John and I have discussed the business arrangement and have come to an agreement on how to handle it. I will start an LLC and provide the finances and John will bring the knowledge and expertise. He will manage the subs and make sure that the budget is all going according to plan. He will also teach me the system that he created for both assessing a potential flip and managing the project. John brings a lot to the table, including being a licensed real estate broker. I cannot understate how important that is for what we are trying to do. We are able to go view houses immediately and on our own. He has access to the MLS and can do research on comparables.
We identified a house in a suburb of Chicago. It’s a 3 bedroom, 1.5 bathroom split level. It’s in bad shape and needs A LOT of work. I don’t want to get too far into the financial details at the moment because we haven’t yet put an offer in, but I promise to update you on those details as soon as I can. In terms of the work needed, you can put nearly everything on the “to do” list. This house has not been maintained very well. We think the owner may have been elderly and passed away and the entire contents of the house are haphazardly strewn about everywhere. We think she was either a hoarder or that the family went through everything very quickly. It’s a little sad, actually. There is industrial carpeting everywhere (even the kitchen!). There is not a single item in the house that we would keep. This is one doozie of a project.
So, right now I’m trying to get my ducks in a row. I’ve contacted my bank and have a pre-approval letter on the way, I’ve started looking into what it takes to start an LLC, and I’ve looked into the types of insurance I need to get. John has been working the budget over and over again and he is doing his research on potential subs for the different jobs.
I’m feeling nervous and excited.