Insider Secrets to Fixing and Flipping
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The current housing boom owes its existence to the advent of low interest rates, relaxation of mortgage loan credit and income approval criteria, and very favorable income tax breaks for home-sellers. Today, most home sales are tax free; and when capital gain taxes are incurred, tax rates range from a low of 5% for those in the lowest two tax brackets to a maximum of 20% for those in the highest tax brackets.
The combination of low taxes and interest rates put more money into the consumer’s pocket to spend on something else. By and large, he has chosen to use it to buy a house, creating unprecedented demand for single family houses at every point in the price scale. Here‘s why:
When a person buys his first house, it creates a flow in the housing market that extends to the highest levels. Here’s how it works: New homeowners moved up from rental housing to home ownership. The person they bought from used the cash to pay off bills while they used 100% financing to leverage up into larger homes. All those who sold these homes moved up to bigger and better houses, etc. With each successive sale and purchase, it drove the prices of houses skyward at unprecedented rates.
Exploding house prices attracted a lot of money into the market in the form of investor participation and new low cost loan money. That made it feasible for rehabbers to buy even more houses to fix up, and it made it easier to sell them once they were placed on the market. Everybody in the business seems to be making a lot of money compared to the relatively small amounts of money at risk. Rehabbers’ margins are much greater than new home builders’ profits.
Everyone cashed in on this phenomenon: Real estate Brokers and Bird Dogs who got paid fees for finding houses for rehabbers. Loan Brokers and lenders — both private and institutional — who put up money for acquisition and improvement.
One hundred twenty five percent Home Equity loans were made so that homeowners could speculate by buying fixers for low cash prices, fix them up, and sell them to consumers for cash. Vendors who sold building materials, appliances, floor coverings, counter tops and cabinets, roofing, etc. started making big money. So did all those people who did the actual rehab work. So did Brokers and Financiers who made long term mortgage loans to the ultimate owner-occupants.
For all of these reasons, the rehabber business is just about the best business in real estate today. Where it will go from here is anybody’s guess, but as long as houses can be bought, fixed up for sale, and sold for cash, there’s a lot of money yet to be made as a rehabber.
This Fixer/Flipper seminar book includes houses bought at deep discount to fair market value that require only minor cosmetics such as cleaning and painting, and which are “flipped” as quickly as possible for top retail prices to consumers.
The term “Fixer“ includes houses that are fixed up to sell, and house that are fixed up to hold as long term rentals. The term “Flipper” is equally all inclusive. A “Flipper” can be a person who “flips” houses in the retail markets. It also includes those who “flip” contracts and houses themselves at wholesale prices to other entrepreneurs with only a small profit. So “fixers” include “fixers” and “fixers include “flippers” as wall as long term rentals.
Many times houses are sold before they’re even bought. Indeed, it is probably more the rule than the exception that wholesalers rarely go into title, simply choosing to flip their contracts rather than to buy and sell houses. High volume wholesalers often do business on a strictly verbal basis, finding and flipping houses between themselves without even going to contract. They make the most money of all because they can move so swiftly in and out of the market.
It’s an odd paradox that even in this red hot market, a large number of people buy “fixer” houses to rehab and to hang onto as rentals. There are compelling reasons why this isn’t a bad idea to be on the look out for fixing and flipping opportunities. This book will teach you how.
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TABLE OF CONTENTS
6. 4-F Formula
7. Finding Profitable Houses
9. Advertising Media and Methods
9. Sign Strategies
12. Direct Mail Approaches
12. Two Insider Secrets for Using Direct Mail
14. Getting Your Envelope Opened
16. Print Advertising and Flyers
16. Using the Auto Trader
17. Telephone Techniques
18. Bird Dogs
22. Breakout High-Tech Applications
23. Using Pictures to Buy and Sell
24. Negotiating Fixer-Upper Deals
27. Negotiation Outline for Success
30. Financing Fixers and Flippers
32. Ten Ways to Raise the Down Payment
35. Renting Signatures and Loan Guarantees
36. Creative Real Estate Notes
39. Mortgages and Deeds of Trust
40. Wrap-Around Notes
41. Using Financing to Protect Houses and Owners
44. Installment Sale Concepts
52. Assignment of Contracts
53. Leases the Act Like Contracts
54. Leasing for the Down Payment
55. Financing Fixer Uppers Creatively
59. Single Payment Note Financing
64. Payment Agreements
66. Shared Appreciation Financing
67. Retirement Plan Loan Strategies
69. Making Big Money Fixing Houses
69. Two Critical Secrets for Making Money Rehabbing Houses
70. Knowing What To Fix First
77. Fast Flipping and Fixing
78. Motivating Salesmen to Sell
80. Looking Good When Buyers Are Looking
81. Five Ways to Make Appliances Sell Houses
83. Getting the Price Right
84. Ads, Signs, and Flyers That Motivate People to Buy
88. Motivation Fundamentals
91. Selling the Sizzle, Not the Steak
92. Toxic Mold Disclosure Agreement
94. Qualifying Buyers’ Needs vs Wants
95. Selling Only to Pre-Approved Buyers
99. Closing the Contract to Close the Sale
103. Closing Fast
104. Assembling Your All-Pro Team
108. Getting Marginal Buyers Approved
112. Using Seller-Finance to Boost Profits
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Topics: Buying & Selling