House Flipping Couple

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The Burnout House, Amarillo Texas

Becky and I had purchased our first Investment Property, and everything went very smoothly. We had no problems. I thought it was because I was just “That Good of a Real Estate Investor”. O’Boy were our Eyes about to be opened. The reason it went smoothly was that the Wholesaler, the Title Agency, and the Bank were all very good at their jobs and did not let us make any mistakes. It had nothing to do with our ability, but looking back now, our luck.

Now it was time to put our Great new Investing “Talent” to work. I found the 2nd property that we had ever purchased. Again the process to buy the property went smoothly, I was even able to get money for the rehab. We were going to flip this house. As we look back now, our plan at this point was to buy and make money. This really is not a plan at all. What we do for our students is help them create a strong Plan, understand they have to stick to the Plan and complete the Plan in a set time.

This house was going to be a major rehab. The house had been wrongly wired when an illegal addition had been added, which caused the house to catch on fire. We had secured funds for the rehab, but I didn’t really know how much the rehab would cost or even how to estimate them myself. Becky and I now have taken this expensive lesson we learned off this flip and coached our students on how to get a good and accurate estimate and set up a budget and stick to it.

So let me tell you what happened, I acted as the General Contractor and hired Subcontractors. So what could go wrong? I didn’t get multiple bids on the work to be done. I hired the first SubContractors that gave me a bid, I paid most of them up front, and I did not know if the job they were doing was being done correctly. I did not know what I needed to have looked at and how extensive the damage was . Looking back we got really lucky because the work was done right and what we’ve learned about what is a good price or the work done, we really did not overpay too much. We did go way over on our “Detailed” budget because we had not allowed enough to fix many unseen, unknown structural issues. We did have one Subcontractor give a verbal quote of $1,500.00 to do some work and then charge us $4,500.00 (that was a good 3,000.00 lesson in and of itself).

As you can see, at this time, we had no long-term plan to create that Long Term Legacy Wealth that I wanted for our future. We were only looking for that Short Term Infusion. At this point, I was acting like most people, HOPING for that Long Term Legacy of Wealth, not planning for it. As Becky and I look back and understand what we learned from the mistakes we made, we show our students how to execute the Trifecta plan that we have created and perfected that allowed us to achieve that Long Term Legacy Wealth we want for us and our family.

When we sold this house we walked away, at closing with $2,000.00. A profit but not what we had Hoped for. Thankfully we took and learned from this and now help our students to learn from our experiences so they will not make the same mistakes. This was not the Big Money we had hoped for, but this was truly a win for us because the lessons learned were priceless.