In order to minimize that risk, I wanted to learn the business first so that I would know the red flags.

High crime and low school ratings are certainly red flags in my book.

And red flag for me too.

@Will Barnard  the reality is this is just nothing money the dollars are so small.I have never kept an EM deposit even though sometimes I wanted to just creates too much bad blood... heck a few grand to me is not going ot change my life style and if I beat it out of some shmuck .. like its apparent these Texas wholesalers do well just shame on them.Now if we were talking about a major project or bigger money with bigger players then that may be something different. .However like when I have flipped plats to DR Horton and other builders..

We use preprinted signs that are a yellow background with red lettering. 

we bought our first house in VB, the red mill section.

Go ask some of the players in Silicon Valley!

Does anyone have additional advice of what red flags I should be looking for?

I have a friend with the most disgusting looing vehicle but it has one simple message painted on in red on the white body of the vehicle - "I Buy Houses."  

Bright reds and blues seem to be popular at this time.