Hello Everyone,

There is real estate contract flipping and then there is real estate flipping. They are two different instruments. Contract flipping involves locking prospects into a purchase, option or trust and simultanously assign or sell the right to perform
for a fee.

There is owner finance flippling where a seller creates a trust deed/seller financed note and simultaneously assigns or sells that contract to an investor or financial institution at closing.

Real estate flipping typically involves short term holding for the purpose of rehabbing/re-positioning for resale. Based on capital gains objective this can range from 1 day to over 2 years.

Finally, there is simultaneous real estate flipping. Here's where the investor enters into a purchase, option or land trust and instantaneouly sell or assign his "right" to perform on the contract. This is often done simutaneously at closing. There is no holding time.

The term wholesale flipping typically relates to finding a deal and simultaneously selling the right to perform to an investor for less than retail profit. Wholesale flipping does not require the use of the seller's money, credit or traditional closing. In my experience, wholesale flipping typically involves an investor bird finding properties for rehab investors. Wholesale flippers seldom use their own money or time to fix properties. Their goal is to profit a few thousand dollars from finding deals for REHABBERS.

This is most descriptive of a true wholesaler.



SOLDHOMES, if REO is in abundance you can flip it or wholesale to a REHABBER. If you find a deal of the century, you can live in it. An investment in a duplex should be assessed based on the area and your financial motive. Specialists tend to do one thing and one thing extremely well and a generalist will use all the tools at the right time. To each his own.

Hope this helps.

Think about locating great flip (or wholesale flip) properties, determine 3 or more exit strategies that could build up cash reserves, then consider the possibilities once your capital is secured. Wish you the best and a prosperous future!

BUY HIGH, SELL HIGHER using seller financing such as lease options, lease purchase, wraps, AITDs, contract for deed, land contracts, installment land contracts, equity share, subject 2, etc

these strategies work on properties with no equity regardless if the payments are current or not. why? because none of this requires any of your credit because the seller already qualified for the loan based on their down payment, credit, finances, etc. they'd have to keep the loan in place and wait for their loan to be paid off sometime in the future. just make them a full price offer or whatever they owe on the loan balance and find someone else to take over payments. it doesnt matter what the market does just as long as you have a tenant covering PITI and the investor getting positive cashflow.

those methods can be used as an entry or exit strategy. majority of my competitors are in the foreclosures, REO, short sale areas.

while majority of the investors are low balling sellers, only a handful of us are making full price offers and getting them under contract with a non exclusive option which allows us time to advertise for our partner (buyer's who've been turned down with conventional financing but has 3-10% in cash to put up front and with an owner's mentality).

Hello Alvin,
Saw your comments about R/E Agent investing. Question: what does AITDS stand for?

all inclusive trust deeds.

it deals with a would-be buyer who cant qualify for conventional financing to put up a down payment in exchange for the deed. this is also called a wrap around where the seller has an underlying interest rate of 5% and can increase the rate to 9% which allows them to cash flow above their PITI. they also mitigate the risk by collecting 5-15% down. most lease option investors dont ask for this high down payment but rather a small non refundable option fee. lease option investors attract people with renter's mentality. AITD aka wrap aka owner financing attracts people with an owner's mentality.

investors who are doing these types of owner financing are involved as a middle man via double wrap or sandwich lease options. they acquired an interest as a principal and theyre reselling their interest/terms to someone else to take over the payments. seller may get to keep their existing equity by freezing it and waiting for the sale or refinance. investor gets to keep the positive cashflow and some up front money and some future appreciation(if any). look up these keywords on google and youll find some good resources.

in regards to AITDs/wraps, usually the seller would have to foreclose on the buyer if they default in which title is compromised and due on sale clause maybe triggered. its doable but dangerous if you dont know how to mitigate the risks.

thats why most brokers wont allow their agents to do these because of the liabilities.

let me know if you have any what if questions

if you understand how to do these alternatives to seller financing ethically, legally and safely, you can be very dangerous among your competitors because most agents cant do these. they need to be trained with an investor's mindset or have a very dynamic broker who also does creative investing.

think about all the buyer turn downs that have 3-10% that are unable to qualify for a new purchase loan. these are the leads that can be turned into a lease option, wrap, AITD, contract for deed, land contract, equity share, sub2, etc regardless of credit and no bank qualifying.

I learned something new. You find those deals in GA... I'll take 5!

Buy and flip is good and you don't need REO properties only. You can find all different kind of properties. What you have to have in your mind is that we are in depreciating market and flipping properties is dangerous. You have to make sure if the market is depreciated in your area and what is the %. Make a good research before you go after it.

You have a lot of options and all of them could work, you just need to define your priorities and the market in you area. I prefer long run investment but I see a good deal for flipping I do it. If you need fast cash try to flip but if you can't you can ever rent that property.

If I were you, I would not buy anything at this time, especially if you are a new investor. this is no time for newbies to go into the water. This market is destined to go down as the worst real estate crash in our history! I know you won't hear that anywhere else on this board, but that is the truth.

Try to get into the middle of transactions and take a piece as it goes by without ever taking ownership, like short sales. http://WeDoShortSalesForYou.Com
Or team up with a loss mitigation company and make money simply by referring homeowners facing foreclosure to them and making a fee.

Keep an eye on the # of permits for new housing in your area. That is the best indicator of what the pros think about the market a year or so out. Buy when you see the number of permits rising steadily. Be patient, it probably won't be for another 3-4 years before that happens!

Good Luck!

Bill Young

i work with 2 investors. one of htem has 2 settlements this week. one for the sale of one of his flips and the other settlement is the purchase of his next project. he is making 86k on his side of the hud and his expenses are around 17k. he owned the property 91 days on the day of settlement.

you can make money and it is a great time to invest, just depends on what kind of investing you want to do.