buying, holding, and recouping my money

[DeWayne Mann]

so, im getting conflicting answers from people. my question is this: if i use hard cash or private money to buy, rehab, and hold. as long as i keep my ARV under their loan threshold of 70-80%, i should recoup all the money i put into property...correct? yes....this is how green i am.

[Aaron Montague]

Seasoning is a pleasant way of saying "I'm going to make a minimum amount on my investment."

Example:

I lend you 100k for a flip.  You've convince me the final sale price is going to be 150k.  I'm lending at 12%, no points.  I put a 6 month seasoning minimum in my contract with you that assures that I get paid at least 6k on this money.  Even if you grab a loan from another source and pay me off quickly.

Seasoning from a conventional point of view is a way to slow flippers and rehabbers down so they don't abuse programs like FHA and rural development loans. Those loans are designed for owner occupied buildings, not flippers.