Tax Equity Flip Structure
Tax Equity Flip is a method of real estate investment that pays off capital gains on the sale or transfer of a home equity loan to an investor. Equity loans are made by lenders to homeowners in exchange for interest paid from the borrower’s monthly mortgage payment to the lender. Equity loans are not interest free but do not accrue interest until the full principal is paid out. A homeowner must own the home and be in complete physical possession of the property at the time of the transfer in order to receive this equity loan. The proceeds from the equity loan are exempt from Federal and State taxes.
By purchasing Tax Equity Flip you are able to benefit from the equity finance option offered through Tax Equity, a provider who specializes in this type of investment banking. This option allows you to purchase homes based on the performance of their underlying equity. If the home appreciates more than the value of your loan then you can sell it for a profit. If it depreciates more than the amount of money you financed, you will lose money unless you have the option to use tax equity flip.
Investing in flip offers peace of mind and allows for flexibility. You can close a deal as little as two months before the due date without waiting for the closing bell to ring. The process is simple; you locate a home that needs financing, review the details and select a lender. All you need to do is find a buyer who needs financing and a broker or agent who has access to these types of deals.