flipping rules

[longshot]

equity lines from other properties

[Nancy Young]

"Dan" wrote

The first time I heard of the word flipping (in the real estate sense, heh), it was in a negative way. There were appraisers and mortgage companies and some flim flam types in on it. Buying houses and flipping them within days to low income people. They were getting them those HUD loans/whatever.

Bottom line, they made a ton of money and a lot of people wound up in houses not worth the mortgage on them. That's why there are rules like this now. I guess if you want to flip quickly, you can't sell to people applying for FHA type loans.

nancy

[Oren]

The TAX MAN tied up bunch of mine. Checks for 25K to him are frowned upon and deeply regretted. I like the idea of collecting interest, but I'm not buying or selling at the time. Sitting on my hands.

-- Oren

"I don't have anything against work. I just figure, why deprive somebody who really loves it."

[Oren]

Dangerous turf. The wallet is only so fat.

-- Oren

"I don't have anything against work. I just figure, why deprive somebody who really loves it."

[Roger Shoaf]

Steve,

I am not an expert on much of anything, but your contention that short term loans are always a higher interest rate is not always true. If for example a lender believes that rates are going to rise they might not wish to commit their funds for a long term at a rate that they might regret later.

The primary criteria for determining an interest rate is risk, the higher the risk the higher the interest rate. You are accepting a risk when lending construction funds. In the event of default by a builder suppliers are the first in line with their mechanics liens on the property, and you have no control over the market that may tank dwindling the value of the parcel of land.

What you are doing is betting that the borrower will be successful in bringing his development to fruition, selling it and having enough left over to pay you. I also suspect that your friend with the initials after his name got his cut off the top after selling you the proposition, making his risk zero.

I hope your investments pay off, but their aint no such thing as a free lunch and hocking the family home to lend money to someone else is taking a risk that can go south, especially if you do not have funds on hand to cover mortgage payments in the event of default.

Good luck.

[Steve B]

Enter LLC's, corporations and family trusts. Lovely legal protective shelters. Roger, I've been doing this a while. I have a guy that I trust

200% who does a major AM radio program all over the nation on investments. This ain't my first rodeo. I'm 58, and fully retired. I do NOT work.

What I do is not for everyone. What I do can't be done by everyone. But it works for me.

Bottom line is, there are lots of investment programs and profitable ventures for every pocketbook. You just have to decide whether or not you want to pay $40,000 for a $20,000 car or drive less and invest more. Goes down from there to lots of everyday choices from shopping coupons vs. going out to eat all the time. Even if you just put $20 a payday in the bank at low interest in a savings account.

All life is choices. No need to be stupid, and get into things where there is high risk, and the only one who makes out are the principals and the brokers.

The whole thing started over "flipping rules". What, exactly are they? Answer ...... there are none. You can make good money, or you can lose your ass. It's a crap shoot, but only for those who want to take risks.

I love Teddy Roosevelt's quote regarding critics ..........

"It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly; who errs and comes short again and again; because there is not effort without error and shortcomings; but who does actually strive to do the deed; who knows the great enthusiasm, the great devotion, who spends himself in a worthy cause, who at the best knows in the end the triumph of high achievement and who at the worst, if he fails, at least he fails while daring greatly. So that his place shall never be with those cold and timid souls who know neither victory nor defeat."

Good luck in whatever you choose to pursue.

Steve

[Oren]

I have not failed. I've just found 10,000 ways that won't work. Thomas A. Edison

-- Oren

"If things get any worse, I'll have to ask you to stop helping me."