Before we get into it, here’s a quick recap.

Quick Recap: Ten Commandments of House Flipping

1. Thou shalt know the After Repair Value (ARV) ✅

2. Thou shalt keep multiple exit strategies ✅

3. Thou shalt make offers daily ✅

4. Thou shalt leverage the inspection period 👈

5. Thou shalt not advance money to contractors

6. Thou shalt build relationships

7. Thou shalt master Other People’s Money (OPM)

8. Thou shalt view failure as a lesson

9. Thou shalt respect the game

10. Thou shalt be nice

Fourth Commandment: Inspection Period

During the inspection period, the property is officially “off-market” — meaning only we have the right to buy it during this time. This gives us a set timeframe to conduct our due diligence, and it’s not about a standard home inspection. In fact, I never pay for those. Instead, I focus on these five things:

1. Buying the property – If I plan on closing the property and taking deed for any period of time, I will bring in as many contractors as possible to provide bids that align with recent sales in the area and ensure the property will pass all necessary inspections.

2. Wholesaling the property – When wholesaling, I will schedule access for my buyers. This is THEIR inspection. I do not let them tie it up with additional inspections or contingencies.

3. Lender commitment – I pitch the deal to multiple lenders who provide Other People’s Money (OPM) and let them compete for the chance to finance the deal.

4. Confirm ARV – I will again scrutinize the After-Repair Value (ARV), seek a second opinion, and see if I can identify any risks with my chosen exit strategy.

5. Have two exits – Are you keeping as a rental, flipping, wholesaling it, or offering contract for deed? Make sure you have at least two exit strategies that apply.

If any of these checks don’t align with my initial calculations, I’ll walk away from the deal and pursue the next opportunity. I make it a priority to be transparent with the seller about the inspection period and meticulously document everything to eliminate any uncertainties.

Once you understand and internalize these principles, you’ll feel confident making multiple offers.

If I am buying to flip the property, the inspection period is essential to the funding phase. As soon as our offer is accepted, we shift to the funding mode and secure those contractor bids, lender commitments, and confirm the ARV and exit strategy. This business runs on systems — systems for each project and systems for the entire operation. But remember, always include an inspection period in your offers to maintain full control.

Next, we’ll dive into the rehab phase and discuss contractor payments — a topic I’ve learned from hard earned experience. Don’t miss it if you want to avoid costly mistakes.