My Intentions, Should I Reveal Them.
If I intend to get a loan to purhase a house to flip it for profit, does my lending institution need to know the full scope of my intentions? And if so, are there any negative repercussions or direct drawbacks from my lending institution if they know I intend to "flip" the property? I imagine this is a simple question, I just hope it does not allude greatly to my naivete. 
It depends...
If you are going to your local bank then I would certainly tell them because they will be able to structure a loan that fits your needs better.
If you are working with a mortgage broker tell her so that she can shop for the best program. From there the lender doesn't need to know.
However, a 1003 application will ask you if you plan to occupy the property as your principal residence. If you lie here you are likely commiting loan fraud.
My question would be is it really in your best interest to get bank financing for a flip? I have always used private cash to finance my flips with a annual ROI for my cash investors. I look at it this way, I am going to pay closing costs to get the deal funded if I use the bank, then when I go to sell it, one of my incentives is to pay the closing costs for the buyer. Lets say I borrow 45K from a private investor cash and give then a 12% anual ROI on thier money. Lets also say I can do five flips in a year with that money so I would give then a 5400 return at the end of the year. No lets say instead I go get bank financing and have to pay 2500 closing costs on each one. Thats 12500 I spent on closing costs just to get the deal in the first place for a difference of $7100. And thats only at 5 flips maybe you can do 8 or 10 or 15 in a year. Plus it doesn't show up on your credit report. I am not 100% sure but I don't think you will do your credit score any favors by having a bunch of mortgages that are paid off in a month or two, plus the mortgage companies will probably catch on and you will have a harder time financing your flips. As far as I am concerned, private cash is the way to go IMHO.
Joe
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