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When House Property Wrapping Goes Wrong

Updated: Feb 29

For many, positive cash flow property wrapping can be a magnificent and satisfactory experience for both the wrapper and the wrappee but unfortunately, if the homework hasn't been done properly in the first instance, things can and do go wrong.

This is where you should take a look at The Aussie Wrapper Complete Guide

In this post I would like to talk about why this happens and what we can do to prevent it.

For the majority of times, it is the quality of the intended purchaser (the wrappee) that is to blame. Despite background checks, it is possible that you end up with a wrappee who causes problems or fails to make regular payments on time.

Often it isn't the intention of the wrappee to fall behind on payments - like any loan repayment, you can never foresee problems like ill health, accidents, sudden loss of job or other factors that can drain a person's income or increase their expenditure.

Prevent pitfalls from House Property Wrapping | Paul Zalitis | The Aussie Wrapper

Another reason why wrappees fail to make payments is because they have overestimated what they can pay in the first place, often in their eagerness to purchase a property, they haven't fully disclosed all of their outgoings or haven't taken into account all that is needed in order to maintain a house.

It is often a wise idea to ask them to seek proper financial advice before going ahead with a wrap property just to make sure that they do know exactly what they are letting themselves in for.

In this vein though, it is worth running through the reasons why people need to house wrap in the first place. Don't just assume that these are people with terrible credit records who are rejected by the bank and other financial lending institutions for this reason.

The majority of successful house wraps are in fact made with people who cannot get a mortgage (even though they can clearly demonstrate their ability to make payments). These people may be: self employed business owners, employees who have not been in their place of employment for a long enough period of time, people who have received a compensation pay out, people who perhaps have had a few gaps in their work record for various reasons, people who are paid in cash, those that perhaps have one or two blemishes on the credit record, ex-bankrupts who are now back in credit, pensioners/elderly, seasonal employees and New Australians.

At this point, I really do need to stress that you should follow the advice of a positive cash flow property wrapping expert such as myself in order to minimise any problems.

Of course, you can never absolutely guarantee that there won't be any problems but by knowing what the pitfalls may be and putting strategies into place that will help minimise or negate any problems, you are less likely to run into issues. You really need to know what you are doing.

Do your research before house wrapping | Paul Zalitis | The Aussie Wrapper

If it is still in your mind that you can do this on your own and work it out, please follow your head and not your heart. While it is wonderful to think that you are helping somebody's dream come true by giving them the opportunity to own their own property - if you know inside that this is a risk that's not sitting well in your gut, don't go ahead or you just may regret that decision. Make sure you go through absolutely every little minute detail and know clearly the risks ahead for both you and your client.

To Your Success Paul Zalitis The Aussie Wrapper


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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