Actually I am not quite in agreement with the statement about flippers. Given the first hand experience we had, pretty much none of what was said applied. First off, homes that were purchased at trustee sales by private parties are harder to obtain financing for in a short timeframe. What used to be only FHA guidelines with respect to a minimum 6 month seasoning before financing could be obtained for a buyer purchasing a flip quickly became adopted by MOST (but not all) lenders for conventional financing. Furthermore the lenders would also want verification on the profit margin being realized by the flipper as well. If that profit exceeded their guidelines they would not finance the home. We stopped our activity by mid 2010 so perhaps things are not as tight now. As with anything, I would like to see some hard data with reference to the statements made above.

Bank owned REO properties and short sales were/are not subject to the same scrutiny for obtaining financing. In fact Homepath financing is almost absurd these days.

Similarly with regards to down payment assistance and closing costs assistance when purchasing from a flipper, there is no difference there then there would be if you bought from a non distressed or reo. Short sales not so, because idiot asset managers work to guidelines that are generally unrealisitc. At any rate, if the assistance that is referred to above exceeds the lenders guidelines, then financing will not go through no matter who or what entity is selling the home.