What does loan flipping mean?

refinancing
Loan flipping is the practice of refinancing a loan frequently over a short time while charging the borrower fees for each transaction. Loan flipping involves refinancing a residential mortgage with high fees in order to strip equity from a home, with little or no benefit to the borrower.

What is toxic debt?

Toxic debt refers to loans and other types of debt that have a low chance of being repaid with interest. Toxic debt is toxic to the person or institution that lent the money and should be receiving the payments with interest. The interest rates of the obligation are subject to discretionary changes.

What is silent second?

What Is A Silent Second Mortgage? A second mortgage is an additional mortgage on one piece of property. It is considered “silent” if that second mortgage or loan is used to secure down payment funds and then not disclosed to the original mortgage lender prior to closing.

What is illegal property flipping?

A con artist buys a property with the intent to re-sell it an artificially inflated price for a considerable profit, even though they only make minor improvements to it.

What are toxic subprime mortgages?

Key Takeaways. Toxic assets are investments that have become worthless because the market for them has collapsed. Toxic assets earned their name during the 2008 financial crisis when the market for mortgage-backed securities burst along with the housing bubble.

What is a ghost loan?

A credit ghost means that a borrower has a thin file, or doesn’t have much of a credit history. It could mean that someone has never borrowed before, or that they haven’t borrowed in a long time.

What is a red flag of an illegal flipping scheme?

(Illegal) Property Flips Some of the following red flags may occur in flips: • Ownership changes two or more times in a brief period of time with the property value increasing significantly. • Two or more closings occur almost simultaneously.