funding flips - Posted by JoeS

Posted by John Holmquist on February 17, 2001 at 21:15:35:

Hi Joe. An additional consideration with flips (assuming this is a retail, not rehab property) is the issue of deferred maintenance. Note buyers or conventional lenders don’t like to fund properties that have deferred maintenance. By this I mean actual structural problems like roofs, plumbing, HVAC, etc. This does NOT include things like out-of-date kitchens or baths which might be ugly by today’s standards but are fully functional. A reputable appraiser would be a good source of reliable information regarding what is and is not considered deferred maintenance.

Most of my note buyers will fund a flip if, as Greg stated earlier, it’s appraised by a national company.

If this is a rehab property you’re using an entirely different type of funding in most cases anyway. We’re closing 3 of these next week but they’re being funded by private, cash-toting investors who are repeat clients. We make sure our clients either have cash or we set them up with a private lender so they have access to funds.

funding flips - Posted by JoeS

Posted by JoeS on February 17, 2001 at 06:14:48:

Can anyone out there help? I have posted advise and answers for some time, and now I am in need. Are there still note buyers who will do simultaneous closings? The face of this business is ever changing, and it is getting harder to do these type of deals. I am in NY State. Thanks in advance, Joe

Re: funding flips - Posted by Greg-IN

Posted by Greg-IN on February 17, 2001 at 11:06:48:

We went with owner financing on 3 flips last year, and had NO problems as long as we had a national appraisal supporting prop and decent buyer credit. Underwriting was pickier than prior years on documentation etc. however. So, it is not as easy as it was but is still doable.

I happen to use Midwest but I understand that others such as Sunvest and Associates and probably others do these.