Short Sale Flipping "Illegal"??

[Ashley Robertson]

I met with a realtor today who said she has years and years of experience in short sales and explained to her when I had been in investing years ago, I basically was flipping houses for quick cash. I would get a home under contract, find a buyer, simo close and get a check.

She told me this is ILLEGAL??? I mean, I was dumbfounded. I wanted to get back into flipping but take advantage of the short sales we have here in the Las Vegas market. can anyone shed some light on this?

[J Scott]

Is there an addendum that generally comes with short sales that indicates what is and what isn't expected of the buyer? Are there selling restrictions that are introduced by the lender as part of the contract?

The reason I ask is that it's not clear where the concern is about buying a short sale and then reselling it?

Presumably, a lender wouldn't have an issue with me buying a short sale, holding it for 30 years and then reselling it. And I don't imagine a lender would have a problem with me holding it for 1 year and reselling it. Even 3 months probably wouldn't draw any questions. But, if 3 months isn't against any implicit or explicit rules, why would a one month hold, or a one week hold, or a one day hold, or even a one hour hold be "against the rules?"

Obviously, I'm missing something here, but I don't know what it is (I've never closed on the purchase of a short sale before)...