| If you have spent any time online in recent years or if | | | | due to people who have engaged in illegal practices. In |
| you read newspapers or watch television with any | | | | these cases, bad operators will in fact purchase |
| degree of regularity you likely have heard of flipping | | | | distressed properties. However, rather than actually |
| properties. You may have heard some stories of | | | | improve the property, the typical bad player will align his |
| individuals who have made money through real estate | | | | or her self with an equally unprofessional appraiser. |
| flipping. With all of this said, you may have heard at | | | | The appraiser and the property owner scheme |
| least something about flipping, but you may not know | | | | together to inflate the valuation of the property. The |
| what real estate flipping is all about. You may be | | | | buyer then sells it to a new buyer for an improperly |
| wondering if it's is right for you. | | | | (indeed, illegally) inflated price. The seller and the |
| First of all, in essential terms, flipping is a process | | | | appraiser will work out some deal to split the proceeds |
| through which an investor purchases distressed real | | | | from the scheme. Again, this is a wholly illegal process. |
| estate at a price that is below the going market rate. | | | | The bottom line is that you should not involve yourself |
| After making the purchase at a distressed cost, the | | | | in flipping unless you really do have some expertise in |
| buyer will then generally work to rehabilitate and | | | | real estate investment and Florida real estate laws. |
| renovate the property. With these improvements, the | | | | When all is said and done, flipping really is not |
| buyer is then able to sell the home to a new purchaser | | | | something that effectively can be done by a complete |
| for a higher price. If the investor pays attention to the | | | | novice. |
| bottom line, he or she normally can make a nice profit | | | | Moreover, you need to keep in mind that there are |
| on their efforts. | | | | risks involved that are not evident in other types of |
| Examples of real estate that is considered distressed | | | | real estate investment. The most significant risks |
| and suitable for purchase in a flipping process includes | | | | center around the whole process of purchasing homes |
| property in foreclosure, in a pre-forclosure process, | | | | for a price below the market rate and then be able to |
| bank owned property (REO), being sold at a tax sale, | | | | rehab the home without putting too much money into |
| property involved in a probate or estate case, property | | | | the process so that it can be resold at a rate that |
| involved in a divorce action or homes that is not in | | | | allows for a profit to be generated. In some instances, |
| good physical condition. | | | | there can be a very fine line between success and |
| You need to keep in mind that in some quarters flipping | | | | failure. |
| has developed a proverbial bad name in recent times | | | | |