If it doesn't have at least 50% equity, it may not be worth pursuing and would come off your hot list.If it does have merit, you need to begin identifying the catalysts or triggers that would motivate the owner to sell.

So while people may in fact be doing it, it doesn't mean they are in compliance with the law. 

The leading real state books and educators teach the following basic approaches to buy real estate creatively.Some good and some not so good.Later I'll discuss the pros and cons of the best creative financing methods so you can determine which to use for your particular situationLand ContractsOptions, Leases, Options to purchaseAITD's (All inclusive trust deeds or wraps)Seller carry back deeds of trusts/mortgagesTaking subject to the existing financingNot recording the deed, which is dangerous if not properly protectedRecording a memorandum of agreement Trusts:Transfer the property to the sellers trust, get the bank to approve the transfer and then have the beneficiary of the sellers trust changed to the buyer.Just transferring title into the buyers name hoping the lender won't call the loan.Equity shareAny of these will trigger the due on sale clause and as a buyer or seller if you haven't put safeguards in place, you are unprotected against claims against the title from showing up and or the lender calling the loan due.Are you prepared to take the chance that the seller may further encumber the property or resell to someone else?

Should I have mail the borrower a letter on company letterhead saying we want to re write the terms of the sale from a table top CFD to a lawyer closing using a LMO to originate the loan,  1st lien including Dodd Frank compliance.  

you have to mention "bay area" in your posts to trigger a ton of key word alerts. :)

Hello BP,I'm quite new to this, like the majority of others posting here, and would very much appreciate any advice or thoughts from you seasoned investors.I am getting ready to pull the trigger on my 3rd flip.First, the numbers:1st floor unit (2 story building) >1000 sqftPurchase: 28kARV: 110kEstimated Rehab: 30-40k??

That's what catalysts (triggers) are all about.I realized some years ago that I was in the liquidity business however I'm really primarily in the problem solving business.

I have read several books on real estate investing,however the information that I gathered did not give me the confidence to pull the trigger.

Maybe not necessarily because I teach him something, but as he teaches me it also triggers more ideas in his head that he can go implement.

I think it will work OK for small multis although it's geared towards SFRsThere are numbers you'll need to plug in which you can mostly get from internet research (property taxes, insurance estimate, rents, vacancy rates) local to your area.The best thing for me was to practice that analysis well before I was ready to pull the trigger on anything.