That way, you're not just comparing apples to apples, but red delicious apples to red delicious apples.

RED FLAG.You say that he takes payments by cash only?  

The home that I'm thinking of purchasing includes a 1 bedroom basement apartment.The house I'm looking at is older but almost move in ready.My plan (and where I'm looking for guidance) is whether my strategy for borrowing makes sense or sends up any red flags.To repair the house I own so that it's ready to be rented I would to tap the equity through a refinance or a home equity line of credit/loan.To purchase the other house I would want to take out an FHA loan.In order to repair the home I have I need to get approved for the loan, locate a general contractor and try to get things wrapped up in under a month.In order to purchase the new home I need to be approved for the FHA loan, contact a real estate agent and go through the regular process of purchase.Minus the actual numbers (which I'm working on) do I have the general process right?  

I can tell you that here in the Springs the auctions seem red hot. 

Also be wary of letter of intents as they are not legally binding, specifically as there is a current tenant in place, and I'd imagine you likely will not be able to get a signed contract in place from this potential tenant.If the borrower won't reveal who the tenant is, I think that might be red flag enough to turn this down.Just a thought, in Southern California, there are a lot of tenants who are willing to do this in the marijuana industry. 

As I have never been party to a HML before, I don't have any real knowledge to offer here ... but requiring payment of the fee BEFORE they even have a loan lined up for you is a big red flag to me. 

And folks whose financial lives are not in order often have a very difficult time submitting a lot of the basic documents that the VA/USDA/FHA/FHMLC/FNMA require, as they often have things on their tax returns or in their bank statements that raise a red flag, or require additional docs, letters of explanation, etc in order to analyze their personal finances.

Wood flooring is about as timeless as you can get....and style trends and preferences go from light to dark, red to brown to gray undertones and small plank to large, shiny to matte...and who,would have guessed people would pay up to,get flooring that looks like old shipping containers planked together and sanded.  

And, they are so understaffed that the chance of an audit is pretty slim, but having home office expenses on Sch C of your 1040 return does bump you up the list in the 'red flag' department.  

What are some red flags should I look for in a shady REO agent?