What is a Quick Flip and How do I Analyze one?
A Quick Flip is a deal that usually is bought and re-sold within 48 hours. How to set up the Analyzer: • Click the Re-Sell “Purchase Type” • Under “Show Scenarios” uncheck “Moderate” and “Conservative” • On the top move Holding Period down to 1 month (although this shouldn’t matter because analysis will take out any variables that are affected by time • Click Add/Remove Variables • Check the following variables to make them visible a. Tax Accounting b. Commission on Sale c. Selling Costs d. Origination Fee e. Loan Term • In the Input Variables, change Sale Price Driver from “Appreciation” to “Plugged” • Move Vacancy Rate up to 100% because no rent will be collected • Make Property Appreciation zero as this will be an instant flip • Slide all the variables down to zero until the Total Profit graph hits zero • IMPORTANT IF USING A POINTS ONLY LOAN a. Make Loan Type “All Cash” b. If you are paying any points on the loan, add them to the closing cost • IF USING A INTEREST ONLY OR AMORTIZED
