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Property Wrapping Process

Updated: Feb 29

I want to help you understand Property Wrapping or Vendor Finance and how it works to create positive cash flow.

Vendor Financing can be a valuable tool for potential buyers to purchase a property from you the seller. This not only boosts your cash flow but also allows you to grow your investment portfolio.

Vendor Financing in Five Simple Steps

  1. The Owner of the home is the Wrapper.

  2. The Wrapper sells a property to someone who can’t get a bank home loan or finance or doesn’t want a bank loan and he/she is referred to as the Wrappee.

  3. The Wrappee agrees to purchase the property.

  4. The Wrappee will potentially refinance within 1 or 2 years.

  5. The Wrappee will make equity (money) out of the property.

Let me give you an example: Bob, the Builder has a home worth $800K in Port Macquarie but was negatively geared and costing him money.

So what will Bob have to do to start making positive cashflow? He can do Vendor Finance.

Here's what Bob needs to do in five steps

1. Deposit - The Wrappee or Purchaser pays a 5% deposit which is $40,000.

2. The Repayments are based on the remaining balance of $760,000.

3. Let me explain how the Interest rate is charged to the Wrappee or Purchaser.

  • If the wrapper, in this case the vendor who is selling the property under vendor finance has a current mortgage, they will add an extra 2% interest to pass on to the Wrappee, the purchaser. (This creates a net profit for the vendor by charging 2% extra interest on the loan payment)

  • If the wrapper, the vendor who is selling the property under vendor finance doesn’t have a mortgage, then they set the Wrappee’s interest rate at market rate plus 2% (The extra 2% is to encourage them to refinance).

4. The Wrappee or Purchaser will need to pay for Council rates, Water rates & Insurance. This is added to their loan payments. The Wrapper or the Vendor receives notices and ensures payment of the council rates, water and insurance are paid when due.

5. The Wrappee or Purchaser can go back to a bank within 1-2 years and refinance the purchased property – they also keep the equity in the house, so any increase in the property value is theirs.

Free eBook with insights into Vendor Financing

I hope that clarifies the process of Vendor Financing for you. If this has perked your interest and you want to learn more about how Vendor Financing works, download my free copy eBook “Positive Cash Flow Property Investing Secrets”. This eBook will give you insights, techniques and case studies to property vendor financing and how you can start gaining positive cashflow.

Download positive cash flow investing secrets from The Aussie Wrapper

As they say, "Knowledge isn’t Power until it is Applied". I highly recommend you Download the eBook now on

In my next video, I will be sharing a case study scenario on how Property Vendor Financing is applied, so remember to subscribe to my YouTube channel.

If you have any questions, place them in the comments or email to

See you soon.

Paul Zalitis, and I am The Aussie Wrapper helping you generate wealth.


About Paul Zalitis, the Aussie Wrapper

What I’ve been doing is helping mates create positive cash flow and helping them achieve their dreams of owning property and building their finances through Property Vendor Financing.

Subscribe to our YouTube channel to learn more about Property Vendor Financing -


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