More insight of the current numbers (considering a 4.5% interest rate for the new loan)House 1Monthly payment(PITI+HOA): $1,700/moPotential rent: $2,300/moCashflow w/o management company and allowance for repairs(house is in great shape): $600/moHouse 2Monthly payment(PITI+HOA): $3,964/mo (if offer is accepted but I believe the case study is valid for any other house)3964-600 (cashflow)-1700(mortgage first house)----------------------$867 I have to come up extra with every month.In this particular house there is also a room with bath that could be rented for about $800/mo (efficiency, as we call it down here).

I would respectfully disagree and I believe the two are mutually exclusive...and should be.  

It's VERY common that title has exclusion of mineral right and no effect whatsoever on resale value, eg: Los Angeles County. 

Talk to the CPA about s-corp options but only if you exclusively plan to flip.

Plus, I have only been sending to around 1000-1500 homeowners every 3 months - nothing too crazy.My offers have all been too low for these homeowners to accept.

How will your lender accept late or defaulted loan payments?

The 2 properties that I had the offer accepted on that were steals ended up having Oil Tank issues when we did inspections.

To answer your question though, wholesaling is getting a property under contract (your offer on a property is accepted) for under market value and passing the great deal to someone else for more money. 

However, since they can say they have lived in the property as their primary residence for two (2) out of the last five (5) years, they qualify for the tax-free exclusion of up to $500,000 in capital gains as a married couple (pursuant to Section 121 of the Internal Revenue Code). 

She said the listing was going to be for 170k. i ran my numbers and the best i could pay is 138k she tells me they would accept.