Question re Flips??



From: Megan Reimers

Hi Everyone, getting addicted to this site Newbie's Paradise! I have been reading up some info on property strategies(john Burley) re flipping I have a couple of questions. When doing this how do you do it so that the vendor and purchaser that you have found are not aware of the deal. The vendor knowing how much you onsell it and the new purchaser knowing what you paid for it? Conflict between parties being the issue. I understand the part of putting 'Joe Blow and or Nominee on the offer and acceptance so that you can opt out of the deal but how would you then do it without full disclosure? I have heard you can secure a property with 'an option to buy' contract that way you can sell the option instead of trying to sell the property as if it was already yours? I am on the wright track.. I have so many questions and I don't want to take up too much room! has anyone done this and could give me some info???
Thanks Megan
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Reply: 1
From: Robert Forward

Hi Megan

What you are planning there is On-Selling, flipping is a different ball game all together.


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Reply: 1.1
From: Megan Reimers

Hi guys thanks for the reply!
Just like I said before new to this just visited the Apprentice Millionaire Guide and found your post Robert about flipping I now get the difference between the two strategies!!
Thx again
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Reply: 2
From: Michael G


If the deal is good, your client will realise that you too need to make a profit.

For example... I recently had a client of mine BID on a property that I am going to SELL to them.

They have happy with the price for a number of reasons...

- no deposit
- 100% finance
- no bank hassles
- repayments less than they are paying in rent right now.

They know my margins and we're both happy.

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Reply: 2.1
From: Megan Reimers

Hi Michael,
Yes I have to agree that I would like to go down the road of 'everyone's happy'.I have more questions?When you say your clients you do this as a business?Are you talking about wraps? Now I am getting confused with the lingo or are you still in the flipping scenario I understood that a wrap is when you become the bank or financier and you onsell the property to someone for A) A profit over and above your purchase price and B) finance the mortgage to them at a higher % rate than what you have effectively giving you a positive cashflow (very simple explanation) but have I got the idea?
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Reply: 2.1.1
From: Michael G


"Client" is so much nicer than "wrappee", hence the use, eventually a business is the idea. I believe in the ideals of Michael Gerber (E-Myth), and that every activity involving money should be structure business-like. because such a mindset helps see yourself to buyers, investors and lenders.

Yes wraps, not flips.

Yes, wrap, you retain the mortgage on the property, but onsell it to someone you pays you back in installments at a margin above your own mortgage.

Flip, your source deals for people, who commission you to negotiate a sale on their behalf, at which point, the flip's client signs the contract (thus you avoid stamp duty). They pay you a finder's fee as it were because the deal is still good to them.

Trade, you find, negotiate and buy a property and then sell it to someone else for a profit (may include renovating the place). You incur stamp duty and capital gain costs.


On 6/19/01 1:59:00 PM, Megan Reimers wrote:
>Hi Michael,
>Yes I have to agree that I
>would like to go down the road
>of 'everyone's happy'.I have
>more questions?When you say
>your clients you do this as a
>business?Are you talking about
>wraps? Now I am getting
>confused with the lingo or are
>you still in the flipping
>scenario I understood that a
>wrap is when you become the
>bank or financier and you
>onsell the property to someone
>for A) A profit over and above
>your purchase price and B)
>finance the mortgage to them
>at a higher % rate than what
>you have effectively giving
>you a positive cashflow (very
>simple explanation) but have I
>got the idea?
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From: Megan Reimers

Hi Michael thanks for the clarification for a newbie like myself much appreciated!! Can you recommend good courses or books on these strategies. Would you be interested in telling me how you got started? Any info would be great.
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