Acronyms

Learn about common house flipping acronyms, abbreviations and formulas used by house flippers.
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House Flipping Acronyms

#   A   B   C   D   E   F   G   H   I   J   K   L   M   N   O   P   Q   R   S   T   U   V   W   X   Y   Z

A

After Repair Value (ARV) – The after repair value or 're-sale value' is the estimated value of the property after renovations are made to the property.  The after repair value is calculated based upon comparable sales nearby the subject property.

Learn How to Calculate the After Repair Value

B

BRRRR - BRRRR is an acronym for a real estate investment strategy which stands for Buy, Rehab, Rent, Refinance & Repeat.  BRRRR is the process of buying a distressed property, rehabbing the property, renting the property & refinancing the purchase into a long term conventional loan.  Upon refinance, the investor cashes out the equity in the property, and repeats the process by using the profits to purchase another BRRRR deal.

E

EMD (Earnest Money Deposit) - Earnest Money Deposit is money that is provided by the buyer to a seller to show good faith that they are serious about purchasing the property.  Earnest Money is generally between $500 to $1,000, but a buyer can offer a larger earnest money deposit to entice the seller to accept their offer.

F

FHA -  The Federal Housing Administration is a US agency that offers mortgage insurance for federally qualified lenders.

H

HML (Hard Money Lender) - A hard money lender is generally a lender that provides short term (6 to 12 month), interest-only financing for fix-and-flip projects, with relatively high interest rates (10 to 15%).
HOA (Home Owner's Association) - A Home Owner's Association is a private association formed by a neighborhood, subdivision or condominium that creates and enforces rules (covenants) for the association.  HOA's will also manage/maintain common areas, pool facilities, landscaping, utilities, trash collection, etc for the association.
HUD Home - A HUD Home is a foreclosed property that is owned and being sold by Federal Housing & Urban Development (HUD).  If a property that was originally financed through a government-insured loan (FHA) falls into foreclosure, HUD pays-off the defaulted loan, takes possession of the property and sells the property on HUD Home Store.

M

MPP (Maximum Purchase Price) - The Maximum Purchase Price is the maximum price you can offer for a flip property to earn your desired profit.  The Maximum Purchase Price is calculated as follows:

MPP =  After Repair Value - Repairs - Buying Costs - Holding Costs - Selling Costs - Financing Costs - Profit

Learn About the House Flipping Formulas
MLS (Multiple Listing Service) - The MLS is a data service provided by a group of cooperating Real Estate Brokers that hosts & lists real estate properties for sale in a consolidated online database.  The participating Real Estate Brokers share this information in a common local/regional MLS system, which is then provided to consumers on the broker's websites.  

O

OPM (Other People's Money) - Other People's Money is a term commonly used to describe the strategy to utilized other people's money to fund your rehab projects, which will decrease your risk and increase your ROI.

R

REI - REI is a commonly used acronym that stands for Real Estate Investing.
​REO - REO is a commonly used acronym that stands for Real Estate Owned.  REO properties are properties that are owned by a bank or lender that were generally acquired through the foreclosure process.

S

SFR - SFR is a commonly used acronym that stands for Single Family Residence.  A single family residence is a property that is zoned for one family.  
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