When to Jump a Loan: How to Qualify a Deal for the Jumping Loans System

Description

In this lesson, I’m going to teach you how to decide when you should jump a loan — and when you should walk away. Before you ever show a seller the ABCs of Jumping Loans video, you’ve got to know if the deal even qualifies. I’ll walk you through how to analyze the property, the loan terms, and the numbers so you can make fast, confident decisions. I’ll also show you the common mistakes investors make — including the two “fatal” ones that can land you in serious trouble. Follow these steps, and you’ll know exactly which deals are worth pursuing and which ones to avoid.

Key Takeaways

Identify your exit strategy first — most Jumping Loan deals work best as buy-and-hold rentals, not wholesales.
The property must fit your long-term plan: avoid high-maintenance homes or poor-quality builds; aim for solid, rent-ready houses.
Work only with a reputable lender — established institutions, not fly-by-night companies.
The loan terms make or break the deal — look for low, fixed interest rates (e.g., 2–4%) and long amortization periods.
Repairs must be manageable — ideally limited to paint, flooring, and cosmetics; no full rehabs.
Always run your rental numbers — determine what rent minus taxes, insurance, repairs, and reserves leaves for your debt service.
Never assign a Jumping Loan contract — that’s a fatal mistake and could expose you to legal trouble.
If you wholesale or sell the deal later, the existing loan must be paid off at closing — no exceptions.
When you jump a loan, you’re responsible for making payments. Treat it like your own mortgage.

Action Steps / Exercises

Define Your Exit Strategy: Write down your preferred strategy (buy-and-hold, fix-and-sell, etc.) and note why Jumping Loans fits or doesn’t fit that plan.
Property Checklist: Evaluate one property using these filters: age (after 1978 preferred), condition, neighborhood, and rentability.
Lender Verification: Identify the current lender. Research whether they’re a major, reputable institution or a risky private lender.
Terms Review: Record loan details — interest rate, type (fixed or adjustable), term length — and decide if it’s worth jumping.
Repair Estimate Drill: Walk through a sample property and create a repair estimate limited to making it rent-ready.
Run the Numbers: Calculate expected rent minus taxes, insurance, maintenance, and management. Make sure the remaining cash flow exceeds the principal and interest payment.
Deal Safety Pledge: Write out this reminder: “I will never assign a Jumping Loan contract, and I will always ensure first loans are paid off at transfer.”