Fix and flip
Buying a property, renovating it and reselling it quickly for a profit. Profit depends on the purchase price, repair costs, holding costs and the after-repair value.
Also called: flipping, house flipping, flip
Related terms
The estimated market value of a property once planned repairs are done. Flippers and hard money lenders use it to set offer prices and loan amounts.
A short-term loan from a private lender based mainly on the property's value rather than the borrower's income. It closes fast but carries high rates and fees, and is common with flips and other investment deals.
A strategy of buying a property below value, rehabbing it, renting it, then doing a cash-out refinance to pull money back out and repeat. It depends on accurate repair costs and appraised value.
A home that needs significant repairs or updates and is priced to reflect that. It can be a bargain, but repair costs and financing limits are easy to underestimate.
Putting a property under contract and then selling that contract to another buyer for a fee, usually without ever owning the property. Some states regulate or restrict it.