What is a Wrap and a Flip?

[Ozsunrise]

Sorry to be so stupid, have done lots of searches here and can't seem to find a definition, altho they are often mentioned
thanks
Susan.

 

[redwing]

Wraps

Hmm..Leg Wraps, Sandwiches, Savoury wraps, Muslin wraps or there's a great explanation here relating to Property Strategies - Wraps / Vendor Financing

However there is another way to sell property called "vendor's terms" or an "instalment sales contract". This is where instead of having the balance due in 60 days it is split into a series of periodic payments that the purchaser must repay over a specified period of time.

When the purchaser makes his/her final repayment the title transfers into his/her name.

Wrapping is a great low or no-money-down strategy that enables an investor to earn significant returns for a relatively small and managable risk.

Strategies - Flips

A flip is a property investing strategy where you sign a contract to buy a property and then sell your interest to a third party before having to settle or close on the deal.

Thanks to Steve McKNIGHT for the above

 

[Les]

G'day Susan,

Since nobody else has "got up to dance", I thought I'd share what little I know - at least it might give you some indication of "where next to Search".
Edited later: Seems I took too long to type this - onya, Redwing. I'll still include my thoughts below - they might fill in things a bit for you......

Wrap - shorthand for "Wraparound Mortgage" - as the Investor, you purchase property for $x - you then offer it For Sale (purchase price $x+20%) and offer finance to complete the deal - thus the mortgage you provide to the Buyer WRAPS around the Banks Mortgage to you.
Usually, this involves a Contract with a settlement date well into the future. The Buyer pays you, and you pay your Mortgagee for YOUR loan, and pocket the difference. When the time is right, the Buyer completes the purchase from you. (There's a lot more to it - but I am not a "full bottle" on it, so will defer to others...)

Flip - is where you find a good property, (e.g. selling at a good price) but choose to "on-sell" it to another Buyer and take a profit immediately.

There are many laws around these strategies that you would need to familiarise yourself with - so don't just jump into them without checking things out with the suitable people (e.g. solicitors, accountants, etc.)

As Sergeant Schultz would say "I know nothing" - so treat the above as a simple guide that is probably lacking in information....

Regards,

 

[Ozsunrise]

Thanks for that Redwing and Les, had heard the term a few times and was wondering what they were! The light is on now, thank you for your wisdom! Far too complicated for me- I'm just a beginner!
Thanks again,
Susan