As a rule I generally assume expenses to be 50% of the gross income for my first look evaluation no matter what expenses the seller reports (unless its more than 50%, then I will use their number.)From there you can get into more detail on what type of capital expenditure budget the property might need depending on what physical condition and what strategy might be best.As far as due diligence once the property is under contract, or maybe before in some situations you will need a much more exhaustive list.

@Reuben Royal - Before you head down this route and spend lots of time and money trying to wholesale pre-foreclosures, from our experience (almost 4 years) of trying to buy pre-foreclosures is that the owners either want to home to go into foreclosure (sounds crazy but true) or are so underwater that they can't do anything with it.We did everything from door knocking, mailing, etc and the only way we ever bought them was at auction.Also many states have strict laws regarding putting homes under contract that are in pre-foreclosure. 

Ive done quite a bit of research and have been able to answer ALMOST all of my questions, but I have not been able to locate any South Carolina attorneys familiar with assignment contracts.

@Kulin Dakwala unless otherwise specified in your management contract you should be able to review anything concerning your property.

Read the contract. 

There are already statutes and regulations regarding fraud and deception in real estate transactions.Educating people who want to be educated is fine, but if a governing body restricts the pool of ready and willing buyers, more properties will go to foreclosure and sit on the market longer.Real estate investors perform a vital function in every jurisdiction: putting properties back on the market, in good condition.Many of the properties they buy could never pass conventional lender's inspection because they typically require tens of thousands of dollars in repairs that most homeowners do not have or cannot do themselves.Additionally, many real estate investors near metropolitan centers can access almost an unlimited pool of funding to buy and remodel properties if the numbers work.From contract to close, the time can be in as little as 3-4 business days.The delay is mostly waiting on title companies.So when flippers mail letters and post cards to owners saying they can "close quick" and "all cash", that is a fact, not fraud.Of course, realtors will recommend you list your property – that's how they make money – so they are self-interested, which makes the report biased.Maybe next time you can have a "flipper" on you show for balanced reporting.The idea of anyone feeling "pressured" by getting a post card or flyer is ludicrous.If the homeowner doesn't want to sell, the solution is to throw them away.But the idea of "there ought to be a law" is equally ludicrous.If there are bad actors committing fraud, the answer is to enforce the laws already on the books.Out of all the properties posted for sale every 1st Tuesday of the month at the trustee's sale, a very large percentage never make it because they are bought by the very flippers you disparaged.If not for the real estate investing community, cities around the country would look much, much worse.My biggest complaint with your report is that you completely failed to get the rest of the story.Your editor needs address this."

I'm in the midst of my first flip there and trying to get another one under contract right now.

The home they are selling is in a great neighborhood and it is really nice so I don’t think they should have any issues selling.They will sign a first right of refusal so if I receive another offer I must give the current buyer 48 hours notice to remove their contingency, if they don’t I can go under contract with the second offer.

So far I've met with a real estate lawyer who built my contracts and developed a program which pulls all the city of LA public delinquent property information from the county assessor's website.

Should I get a contract or security deposit?