One potential problem with this approach is that it cause the loan to be called in.A lot of loans, especially HELOC loans, have a clause in them that stipulates that the proceeds from the equity that you recieve as a result of the loan CAN NOT be used to purchase real estate.The reason for this is that they want a separate loan on each real estate property to be evaluate on the basis of that paticular property.So ask about any such clause when you first consult with your bank.

I'm new here, but I did read the long 2008 thread on appreciation, aside from some of the more flaming parts.

I'm very pleased to learn the rules-of-thumb for cash-flow, like the 2% rule and that...

I'm not sure I follow you...Jeff, the numbers are ALWAYS the deciding factor when you evaluate if it's a deal that makes sense or not.

As I see it, there are basically 3 business flip models:

- Virtual Wholesaling/flipping contracts/contract assingment - no cash needed
- Short Sale/REOs - using a double escrow and transactional funding
- Bulk REOs ...

I go after everything I want in life and I achieve all my goals but I take precaution because I'm not only supporting myself so I have to evaluate my risks carefully.

(As an aside, I was screwed by my broker who was apparently such a good friend with the seller’s broker that he revealed my financial evaluation to him.

Hear what the landlord has to say, and then evaluate how much of what she told you is the truth.

Evaluate the HOA carefully to be sure its funded and well managed.

With the real numbers, I'd evaluate the current net from a sale vs. your loan.

While i haven't read through this entire thread the following is my experience in NY. first a BPO is a brokers price opinion and not an appraisal completed by a licensed appraiser. in one case Chase did a BPO and came out with a market value of 625,00 for a property that had 950k owed on it . the offer came in at 500k and chase indicated that the investor who holds the note would accept no less than 550k. the buyer sent in a contract meeting all of the requirements but chase took so long to evaluate the case they ordered another BPO this one came in at over 700,000 only a few months after the original. they would not specify exactly how much the BPO came in at.