Your Toughest Deal - What Was It? Share Details!
Joshua D.Pro Member
BiggerPockets Founder · HI · Member since 2008 · 16k+ posts · 5k+ votesThere are a lot of discussions on the site about starting out, but I find that those discussions where people share the challenges they went through on difficult deals are the best to learn from.
So . . .
What Was Your Toughest Deal?
Share details about the deal, why it was a challenge, and what you learned from it.
My most difficult deal was probably also my easiest money (and the most I'll probably ever make on one deal). Although I think the excitement of it all took years off my life . . .
This all happened about 5 years ago . . . Please keep in mind that, at this time, our own house had cost us only about $175K, and the 3 rentals we'd bought by then had cost us only $55-75K to acquire. . . .
Found a luxury waterfront property in a gated community going up for foreclosure auction in my county. The guy had had it on the MLS for as much as about $1.2M, and he owed a little over $900K total, spread across 4 different notes. Primary mortgage (which was being foreclosed) was about $675, second was around $200K, and ten there were 2 smaller ones to family members--I forget the amounts.
I figured I don't have a prayer's chance, and I'd never dealt with numbers this large, but we decided to go for it. Couldn't get the owner to talk to me by phone or mail to talk about a short sale or to view the place before auction. So, to even attempt a drive-by on this place, I made an appointment for a realtor to show me another house in that neighborhood, then I conveniently 'got lost' on my way out and drove to this waterfront place. My jaw dropped when I saw how gorgeous it was, and what a great view it had! But someone was home, so I did a quit run--really did run--around the house to check it out as best I could. Looked good to me.
Lined up pre-approval with my favorite lender and headed to the auction, prepared to bid as much as the first mortgage, which usually does the trick if you don't have competition. I prayed for zero competition.
Unfortunately, a realtor was there bidding on the place, and she got the house. She said she was going to re-sell it for market price. sigh.
Well, 3 months later the house showed up on the foreclosure list again. Why? Owner had filed for bankruptcy the very morning of the sale, so the sale was nullified. Yippee! Of course, the guy got kicked out of bankruptcy, and the house went back on the block.
Back to the auction, ready to bid, once again. This time, the room was silent besides me and the bank's lawyer, at first anyway. Then some schmuck bids $1K over me. Long and the short is that I got it for $505K--much much much less than the principal balance on the primary mortgage.
Of course, the worrier in me now worries why the bank let it go so cheap and why I was the only bidder. I just wanted to leave and go get my deposit money. But some guy starts asking me a million question, all of which tells me he has no idea how these auctions go. Turns out, he is best friends with the owner, and he was also the one guy bidding against me. He had no clue what he was doing. Then he asks if I wasn't concerned about the big crack in the foundation. Gulp. Didn't see the crack. "I'm not worried about the crack, thank you," I reply, bluffing.
I call my lender with the good news. Good, she says--send me the contract. Contract? What contract? There's no contract--just a little receipt (like you can buy at Staples) that shows my name, the date, the property, the deposit and balance due. That's it. I thought she was going to faint. My underwriters are going to kill me, she says. Well, long and short is we worked it out through phone calls with the court, although the judge wasn't happy.
Meantime, the owner's friend calls me to talk move-out terms and such. Terms? Here's my terms: move out. Right? No, I remained calm and talked with the owner. He was just testing me, but he was looking for a place to go and would be out in time. He calls me again later and says, "hey, we were moving the appliances out and then thought maybe you might want them."
Wait right here. Stop. Please note that these appliances consist of one big side-by-side, built-in SubZero fridge with matching panels; 3 (count them--3) built-in SubZero bar fridges, also with matching panels; 1 Dacor drop-in gas cooktop; a dishwasher; built-in double ovens; built-in microwave. You're removing the very expensive appliances? Please say no.
Good old-fashioned extortion. He was $15K for the appliances. I agree to $6K while my husband is waiving his hands in freak-out mode. He'll get his $6K after he's moved out without damaging or removing anything, I get all keys and remotes (garage, sound system, automated blinds, etc.). OK. Hubby didn't realize how expensive these appliances were.
Thankfully, we closed without a hitch. The owner even moved out a week before closing, and we had easy, advance access.
The easy part of this is . . . the crack in the foundation, although major, would have cost only $25K to repair. On a house like this, it's certainly worth it. We only had to put about $5K into it for some fresh paint here and there and a little repair to the dock and some yard maintenance stuff.
The VERY easy part of this is that--before I could even make the repair to the foundation--I sold the house myself (no realtor) in just 3 months.
I thought the stress and worry over such a very big money deal would kill me, so in that regard it was very hard. Especially, considering that this was the first home I'd purchased at a foreclosure auction. Very dangerous if I make a mistake.
But it was the easiest money I've ever made in my life, and I'd do it again in a heartbeat.
This was a "tough" deal in a couple of ways, the purchase took about 7 months and the guy I "partnered" with was useless on work.
Back in the late '80s in Houston there were a lot of properties languishing for long term on the MLS and FSBO. I had two deals pending that I expected to close within a month when I found an MLS property in a neighborhood where I already owned a couple of good cash flowing rentals. It was listed at about $23K with a conventional (but no DOS clause mortgage).
One guy that I did business with on my regular job had a rental or two and a good income so I asked him if he was interested in going in on it. He was, so we offered a price that would "zero out" the seller if the listing agent (who we had write the contract) would reduce her commission.
Oh, and it had a deadbeat tenant in it.
We got the contract accepted by the seller and her mother who had co-signed and was on the deed. We skipped the paid inspector but we looked it over pretty close and set our budget. While in the house we realized that the "tenant" was (1) the world's worst housekeeper, (2) running a 6 kid day care in a 1100 sq ft 3/2, prone to allowing/encouraging kids to pee on the floor, (3) not averse to serving way past "fresh" tuna salad to these kids.
While my "partner" was chatting up the agent she said that the owner's mother was in bankruptcy in her home county, about 150 miles away. Yikes. I pointed out to the agent that this unit wasn't closing any time soon, not suprisingly she was unaware that a BK judge had to now get involved in the sale.
We added an addendum to our contract that the seller had to stop the daycare prior to closing.
Along about this time we get a letter from the lender that they were not going to allow us to assume the loan, even though it was assumable.
Anyway, about 8 months and several phone calls to a Congressman's office who happened to be a pretty powerful committeman on several bank issues, we got it closed. Within two months we got the tenant (no longer with daycare income) out, recapetted and repainted inside and rented for about $650.
Within the next year we got a new roof (plus some cash in pocket) due to a windstorm. I did about 80% of the work, my "partner" did the rest. Which was about the same proportion on the interior painting. When we put ceramic tile in the kitchen and dining area I did 90%.
I finally got my partner to agree to a buyout and owned it for another 7 years, good cashflow the entire time and free and clear the last 2 years. My 8 year tenants asked about purchasing it and I did a seller finance deal that was good for all. 4 years later one of them got a good job with a W2 income and refinanced.
Oh, I forgot about the 2nd tenant that we had, who lasted about two months. My partner found this tenant and to say she was nuts (her husband was kind of normal) would be to put it mildly.
On occassion I've been a bit less than meticulous on rare occassion on having places absolutely spic and span. In this case she complained the day after moving in that the tracks for the sliding windows and door were "awful and scummy", and a few other things.
My partner went to check on the windows and admitted they were not great so he spent an hour or two cleaning them.
About a day later she called and said that the kitcen pantry (about the size of a phone booth) was "awful and scummy" and the entire house was FILTHY. None of this was noted on the move in checklist.
He and I discussed it and decided on a plan. We told her that the 4 of us would walk the house together, make a list and then decide what we would do and she could decide whether or not they were going to stay. The oddest thing was that I agreed the kitchen panty could use some new paint, although you could barely see the walls since it was so small, 20" door IIRC.
I cut some new shelves and put a couple of coats of oil-based paint on so I could do the entire job in one trip. I pulled the old shelves, rolled the back and side walls, put in the new shelves and went home.
The next day she calls my partner (she really didn't like calling me, he was a comparitive pushover) and said the pantry was still nasty.
He said he'd come over that night but postponed it because I was out of town, so we shifted it to the next night. She had pulled the shelves out of the panty and told him to BACK INTO the pantry and look at how dirty the FRONT WALLS (about 4 inches on either side of the door) were. Notice, the only way to see this sheetrock was to (1) remove the shelves, (2) step inside and look at these narrow strips.
To his credit he looked at her and said, this falls into the "if you don't like it you can end your lease at the end of the month, no penalty. She left and we were all happy.
I've got another one that I've now sold 3 times but I'll cover it later.
Frank
Oh, this is a good topic Josh!
Probably one of my toughest deals was one that involved helping the seller move out (after the purchase had done through) and finding a suitable location for his cat. It's a pretty long story, though very entertaining.
To make a long story short, the seller decided to stay at a hotel until he found a suitable place to stay (after the purchase went through). Though, he was concerned about his cat as his cat was not permitted to stay in a hotel with him.
So, I ended up calling up various "pet resorts" (I had no idea these places existed) looking for lodging accommodations for his cat. I had no such luck.
As a last resort, I called up the local vet clinics and even the hospitals in the area. Turns out, to have a pet stay overnight in these places they have to be "existing patients."
I was at my wits end and almost ready to give up, when I made one last call. Found a vet clinic who had agreed to accommodate the seller's cat after I told them if they do this that I would continually send business their way to folks I know in the area who are looking for a vet clinic. They agreed. To this day, I still have their contact information and have sent some folks their way.
It was a very interesting experience, most definitely a memorable experience.
p.s. I didn't want to take up too much room here posting up the entire story. If anyone would like to check it out, here's a link for it (as I shared the story on my blog):
http://tinyurl.com/y9qpxk6
Thanks for reading!
My most difficult deal was probably also my easiest money (and the most I'll probably ever make on one deal). Although I think the excitement of it all took years off my life . . .
This all happened about 5 years ago . . . Please keep in mind that, at this time, our own house had cost us only about $175K, and the 3 rentals we'd bought by then had cost us only $55-75K to acquire. . . .
Found a luxury waterfront property in a gated community going up for foreclosure auction in my county. The guy had had it on the MLS for as much as about $1.2M, and he owed a little over $900K total, spread across 4 different notes. Primary mortgage (which was being foreclosed) was about $675, second was around $200K, and ten there were 2 smaller ones to family members--I forget the amounts.
I figured I don't have a prayer's chance, and I'd never dealt with numbers this large, but we decided to go for it. Couldn't get the owner to talk to me by phone or mail to talk about a short sale or to view the place before auction. So, to even attempt a drive-by on this place, I made an appointment for a realtor to show me another house in that neighborhood, then I conveniently 'got lost' on my way out and drove to this waterfront place. My jaw dropped when I saw how gorgeous it was, and what a great view it had! But someone was home, so I did a quit run--really did run--around the house to check it out as best I could. Looked good to me.
Lined up pre-approval with my favorite lender and headed to the auction, prepared to bid as much as the first mortgage, which usually does the trick if you don't have competition. I prayed for zero competition.
Unfortunately, a realtor was there bidding on the place, and she got the house. She said she was going to re-sell it for market price. sigh.
Well, 3 months later the house showed up on the foreclosure list again. Why? Owner had filed for bankruptcy the very morning of the sale, so the sale was nullified. Yippee! Of course, the guy got kicked out of bankruptcy, and the house went back on the block.
Back to the auction, ready to bid, once again. This time, the room was silent besides me and the bank's lawyer, at first anyway. Then some schmuck bids $1K over me. Long and the short is that I got it for $505K--much much much less than the principal balance on the primary mortgage.
Of course, the worrier in me now worries why the bank let it go so cheap and why I was the only bidder. I just wanted to leave and go get my deposit money. But some guy starts asking me a million question, all of which tells me he has no idea how these auctions go. Turns out, he is best friends with the owner, and he was also the one guy bidding against me. He had no clue what he was doing. Then he asks if I wasn't concerned about the big crack in the foundation. Gulp. Didn't see the crack. "I'm not worried about the crack, thank you," I reply, bluffing.
I call my lender with the good news. Good, she says--send me the contract. Contract? What contract? There's no contract--just a little receipt (like you can buy at Staples) that shows my name, the date, the property, the deposit and balance due. That's it. I thought she was going to faint. My underwriters are going to kill me, she says. Well, long and short is we worked it out through phone calls with the court, although the judge wasn't happy.
Meantime, the owner's friend calls me to talk move-out terms and such. Terms? Here's my terms: move out. Right? No, I remained calm and talked with the owner. He was just testing me, but he was looking for a place to go and would be out in time. He calls me again later and says, "hey, we were moving the appliances out and then thought maybe you might want them."
Wait right here. Stop. Please note that these appliances consist of one big side-by-side, built-in SubZero fridge with matching panels; 3 (count them--3) built-in SubZero bar fridges, also with matching panels; 1 Dacor drop-in gas cooktop; a dishwasher; built-in double ovens; built-in microwave. You're removing the very expensive appliances? Please say no.
Good old-fashioned extortion. He was $15K for the appliances. I agree to $6K while my husband is waiving his hands in freak-out mode. He'll get his $6K after he's moved out without damaging or removing anything, I get all keys and remotes (garage, sound system, automated blinds, etc.). OK. Hubby didn't realize how expensive these appliances were.
Thankfully, we closed without a hitch. The owner even moved out a week before closing, and we had easy, advance access.
The easy part of this is . . . the crack in the foundation, although major, would have cost only $25K to repair. On a house like this, it's certainly worth it. We only had to put about $5K into it for some fresh paint here and there and a little repair to the dock and some yard maintenance stuff.
The VERY easy part of this is that--before I could even make the repair to the foundation--I sold the house myself (no realtor) in just 3 months.
I thought the stress and worry over such a very big money deal would kill me, so in that regard it was very hard. Especially, considering that this was the first home I'd purchased at a foreclosure auction. Very dangerous if I make a mistake.
But it was the easiest money I've ever made in my life, and I'd do it again in a heartbeat.
As far as deal making was concerned:
A burned house that I found while driving a neighborhood I was interested in. I sent a postcard to the owner and they called saying they were interested in selling. The place was horribly damaged, but salvageable.
The problem was that they owed way more than I could pay (owed 60k and figured only worth $25k). So, on the first deal, we attempted a short sale. (lucky to have good Realtor to help me) The bank accepted the $25k offer, but the seller, not happy about how cheap we were getting it, decided they were not going to show up at closing.
They were at least 9 months behind on payments. The bank asked if we would like to buy the note for the $25k. We did. An attorney shortly after approached us before we foreclosed and offered to buy the note for $50k. We did that also. We learned A LOT with this deal!!! Mainly that if one door is closed there is probably another door that is open, or a window.
He went on to fix it for around $45k in repairs and sold for around $150k.
As far as touch rehabbing is concerned:
Early on, I got a lead from a wholesaler about a burned property on an estate sized lot (sounds good doesn't it). This was a 4300 sf house that was burned down to 2/3 that size. Most of the damage (though there was smoke damage throughout the whole house) was confined to a large addition.
The house was the largest in the neighborhood so the ideal solution was to just remove what was left of the addition (this saved a ton of money).
This place was rough. If there was a way to post pictures I would. We made a lot of money on this house, but the time it took made it barely worth it. I was still working a full time job and spent countless lunch breaks, evenings, and weeks over there. I was acting as GC. Not fun.
I learned not to rehab burned properties after this. I guess I also learned how to manage and schedule subs.
Pictures can be posted; see link below:
http://www.biggerpockets.com/forums/25/topics/45114-how-to-post-a-picture-
Thanks.
Now for some crispy goodness: :D
I bought a mobile home in a senior park right before the stock market started to decline. It was a sure money maker based on the numbers. Once the market started dropping, I got stuck with that dog for 8 or 9 months. Space rent was $850 a month. I pigeon holed myself into the most narrowest buyer's market: Seniors living on fixed incomes. With the stock market crash most of them didn't have the income any longer to afford to move and certainly not to a high end mobile home park. When the dust settled, I walked away $20K light on that deal. I've made good money (especially in my ROTH) playing with mobile homes, but that last one was a fight just to get out of.
The other hard part of that deal, which I didn't think about before jumping in, was that when seniors pass, they leave their mobile to their heirs. Senior parks have age restrictions and most adult children of seniors have no desire to move in or can't. All the vacant homes in the park were just money drains on these heirs so it became a price dropping war to unload the homes.
I like doing mobile home deals and will jump in again when the time is right, but for now, I am sticking to houses and small apartment bldgs.
Not the toughest but most interesting way to lose a deal just happened.
An employee of a large corporation called me a year ago to sell his apartment. We met, he showed me the place and asked to make an offer which I did. The problem was there were no apartment numbers on the doors in the house so I couldn't pull out the owners name. Since he said he's the owner and his wife needs to approve my offer I didn't think too much of that and didn't hear back from him. Called him 3 weeks later, he said they are thinking about it.
A year goes by. He calls me again (10 minutes to midnight!) and says they really could use some money now, am I still interested? I go to see the place again and this time I ask if they are the owners. "Not quite, it belongs to my company BUT they have been thinking about selling this for ages and everything will be approved and everything will be fine and there'll be no problems and ..." Besides, he wants to get a small commission, in cash before closing, without no-one knowing about it but us. He will not reveal more details. I go "hummmm, OK" and make an offer with terms that would be OK for all the parties in the deal. He says it'll be fine and we'll close by the end of the week. I follow it up a week later, somebody at the corporation has not approved the sale and there's no way to make a deal now. But he is trying his very very best and will let me know the moment anything changes. Okay.
Six months go by and it's the week before last week. I get a call from a woman claiming she has an apartment in the same house. I qualify her over the phone - yes, it - could- be the same place, it seems like she is at least somewhat motivated to sell. Besides, she tells me she's the owner. Delighted at the offer, I agree to meet her at the same time and should be there the time I'm typing this.
And an hour ago she called, told me the meeting is off. That I have apparently already seen the apartment several times and I'm clearly not a serious buyer so she's got no point in showing it to me again. She tells me somebody at the corporation is already interested in purchasing this and it's not sold yet. But because of being me and wasting their time by having seen it already she rules me out right away and does not want to discuss further. :)
I call the man who showed it to me first two times and he tells me it's been sold for a few months now, I shouldn't be taking this so seriously. I ask him about the under-the-table-commission and politely denies it, tells me again not to take this so seriously. "The woman is probably just looking to get some commission in cash, no biggie, it's just what you are doing with investing". I do not deny this and end the call, with leaving the door open, so to say.
"I wonder how many calls I'm going to get about this before the decade is over"? :mrgreen:
Bought my first duplex (still own) while working as a part-time bus driver and cab driver, plus part-time heating oil delivery. In short, not financible.
The offer was 52k with a 1st for 20k to be financed and the seller carrying the balance. Thought anyone would loan on such a small LTV.
The appraisal came in high, at 59k or so, and I think the lender wanted it for himself. The interest rate went to 14% with 14 points and he wanted an esrow for repairs which needed multiple bids. Of course this all happened after I spent $650 on a semi-commercial appraisal, and was into the deal over a month.
Found private financing for 9% on the first from family, which was not what I wanted, but I really don't think the other would have actually closed-felt like mafia.
It's been a great property and is worth 5 times what I paid.
This is more of a "funny" story (I have plenty of war stories,too!). I was buying stuff at the Courthouse around 2000. One place up for auction was a condo (lux) in a development that I was very familiar with.
Turns out it was listed in the MLS. I contacted lister and toured it. I didn't mention the foreclosure auction because many seller's don't tell their agents. If the agent knew, she might have been able to get the sale postponed.
Well, the place went UC immediately and the lister called me to tell me. 3 days later I bought it at the Courthouse. I called lister on my way home and sold my contract to her buyer's for 10K. Not huge bucks, but fun stuff anyway. I didn't have to close or anything - just sold the contract.
Back in 2008 I had the biggest deal of my career at that point... All I had to do was sell this piece of land..
Long story short I had 5 different contracts fall apart for a plethora of obscure reasons...
I finally procured a ready, willing, and able buyer and then the title issues came into light....
3 months later we finally found a attorney who would provide title insurance on the property....
It was all worth it in the end..
Last year we made an offer on a badly damaged hurricane house.
(3 years since the storm.) It needed everything after having 3 ft of sea water in it and going through the storm. Wiring, sheet rock, flooring, cabinets, roof, A/C, everything but the ceiling and studs.
The math worked out pretty good on the deal with the offer.
The night before closing we do a drive by and there is a big sign out front with a notice the city is having a hearing about demolishing the place. I call the city building official the next morning. He explains if there is an approved repair plan the hearing will recommend repair instead of demolition.
As we already had a plan I emailed it to him. We had to make a few changes to stay under the FEMA 50% damage rule or we would have to elevate it. Took out landscape and a few other things and he said perfect. As soon as you own the house we can appprove.
I called the asset managment company in India for the bank in Florida that had the VA forclosue. Explained the deal to them with the city and told them we are reducing the offer by 30%. They tell me no way.I said ok I will watch the bulldozers when they come. 1 week before the hearing their American woman problem solver gets on the phone and gets the info. She calls the city, then calls back and offers a 15% reduction. Nope. She says ok we will do the 30%, close tomorrow. (it was a cash deal.)
Got it done on schedule and budget. Rented out right away to really good tenants. Ended up with a house that appraised at $135,000 for $100,000. Refianced for $90,000. Cash flowing well with only $10K of our money in it.
Just closed on a 28 unit retirement complex that was a night mare! So I had a friend of the family that was a apraiser. I was asking him questions and he knew I was looking for apartments. He finds a deal asks me if im interested then buys it him self. He then turns around a few months later and offers me the apartment. I did the numbers and its a smoker deal. Had lawyer draw up a contract and he signed it. Then we get ready to close and he lets me know that he has a second mortgage with the previous owner for 15 years with a no pre payment clause, (he got a better deal if he signed it im asuming). She is old and wants the guaranteed income. He is trying to flip it to me for a profit. So I can't get clear title to the building.
So I try and give him time to resolve the problem by extending the contract. Then he pretty much lays down and does nothing after I did all the due diligance. I sent my lawyer after him and it drawed out for over a year. Went threw a depositon which was a first and way stressful. He got caught lying in his deposition. I sued for performance of the contract not damages. The building apraised for 21k more than what I was contracted to buy for and could have gone after that but I wanted the building instead.
Got it bought finaly and it is full of old retired tenants that have been there for year. It has below market rents and cash flows at %20 COC as is with out raising rents. It does need some maint but manageable. Nothing comes easy!!
My hardest by far was my first. I was 20 years old at the time, looking to buy my first house. At the time I had worked full time while going to school full time with a good job that paid for all my classes. So I had a nice chunk of money stashed away to use as a down payment etc. Well, after seeing many houses and trying to find a good deal, I found my 'dream' house. I found out it was going for auction and jumped through all the hoops needed to bid on it at auction. I had planned on bidding around 115k for the house, but was outbid at 135k. I waited for the property to vanish from the board (proof that the bidder had proper financing and the deal had gone through). An hour later it was still there and I started asking around only to find out that the auction had minimums on all the properties (this was not told to anyone nor written anywhere and all of the literature implied that the properties would sell that day regardless). The min was 150k, which was more than I was willing to pay on that house at the time. About 6 months later the house pops back up listed at 140k and I keep an eye on it. Less than a month later its 120k. Now this was during the crash, so I assumed part of the price drop was the bank trying to get ahead of the market and get out of the property.
I put in a bid at 115k and it was accepted. I was very excited and when I went to see the house during the inspection, I saw water damage in the ceilings. Apparently the roof was bad but because it was a flat roof there was no way to see without a ladder. But since the house had been sitting vacant so long, water had finally leaked through the ceiling. I opted to let the house go back based on the inspection, but was still interested. I waited and saw that it was relisted at 100k and jumped on it. I applied and was approved for home repair financing where I would forward the cost of a new roof and new drywall to an escrow, then would have the house repaired within 2 weeks after closing and the repairmen would be paid from escrow and I would be returned the excess.
This ended up being such a huge nightmare for me and for my family. Mostly because this was nearing the end of the first time home buyer tax credit, also because the person handling my mortgage was an idiot. I dont say stuff like that often but he was. After 30 days passed I called and asked what was going on and he says "Oh no its a 60 day closing dont worry). It was actually supposed to be 45 at the request of the bank but because the banks counter of 45 days got lost in the shuffle it was 60 days. At that point I urged himt o get it done ASAP as I was nervous about closing etc. He bragged that it could be done in a week and not to worry. At 45 days I started calling him and he finally started requesting paperwork from me. Each day I would call and ask if he had everything adn each day he would say "Well I also need this". This went on for weeks. Then the date of closing starts sneaking up and he admits he is nowhere near ready, luckily the bank extends for another 15 days. Well with the slam of the first time home buyers the paperwork was delayed even more, and of course he kept forgetting paperwork. A week before closing we kept wondering if closing would even happen. He started ignoring my phone calls and being a huge pain about everything. Finally two days before closing we find out we wont make it in time because the documents have to be transported from another county and I would lose my first time home buyer credit because of him. I spent all day calling and brainstorming and we finally figured out that if I drove 4 hours away to close in the morning (bank picked closing company). Then the documents could be processed and sent down the next day (final day of tax credit) and recorded in my county before the end of the day.
Well I was up the whole night before unable to sleep, so my mother drove me up to close. When we got there they still had no docs and told us to wait a few hours. We hung out in a local restaurant and finally got the call to come close. We rushed over only to have the lady doing the closing tell us we were missing paperwork and couldnt close.... my mother lost it. After about 45 mins of dramatics we found out that the final pieces of paperwork could be added to the package the next day when the closing company in my local county would review the paperwork for final approval. Paperwork was signed, big sigh of relief, drove back home saying we would laugh at this some day.
Next day I wait to hear whats happening. I am very lucky I was pro active about all of this, there were many times where I could have lost my tax credit or the house if I hadnt been on it. My realtor told me the house was likely to be recorded about 8 and I would have keys by 8:30. Well 8:30 comes and goes and my realtor heard nothing. I start calling around and find out that it was the last day for the lady who did the closing for us, the wire was lost and no one could reach her. After many calls back and forth to confirm it was sent, they finally found the wire and sent the package down to be processed for closing. Paper should arrive by 1:00 or so and be ready to go at 2:00 for recording since it was just a processing job. Papers arrive, I wait and wait, hear nothing, 3:00 comes and once again realtor has heard nothing. Call the local closing company and they refused to send the papers for recording because they had never dealt with this type of closing before and wanted more time to go through the paperwork and would send first thing in the morning. Told them if they did that I would lose my tax credit and it would come out of their pockets since they werented doing this closing just making sure all the paperwork was there (which they admitted it was). It was a bluff mostly but it worked as the paperwork went out with the last courrier of the day at 4:00pm and was recorded just before closing. Got my keys at 6:30 that night and I drove over there and spent a few hours in the house just in shock at how it all worked out in the end. The next day the whole roof was ripped off lol. It was another 3 weeks before the house was ready for move in and I was able to move in 3 days before my birthday. To this day my mom and I still joke about the horror story of my closing on that house. My next house closing was luckily almost text book, fantastic realtor and the guy handling my mortgage was on top of it and helpful, much better experience.
I bought a condo in Mexico from a family member who was facing foreclosure. She had broken her hip and in order to pay the bill took a loan. The loan was structured as a lein against the condo by a loan shark and his lawyer. Her $5,000 loan ballooned to $10,000 in 2 years and she was receiving threats to foreclose. She offered me the chance to buy the property and keep it as a long term investment while she lived in it. I flew down and paid the loan off with Amex travelers checks and spent another 3k to put the condo into a Mexican Bank Trust, a requirement for foreigners who own beach front property. Tragically, 2 years later she was killed by a drunk driver in Mexico (who was an off-duty police officer). Her belated husband was the caretaker, but 2 years later the place was a mess. The security guard (who was supposed to be caring for the place) next door would invite his buddies to booze on the balcony on a regular basis. He also gave the key to a buddy who was essentially squatting there and living for free totally unbeknownst to me as it was being "looked after" by the spouse of the deceased. I discovered this right about the same time I found out the beach was eroding at a rapid rate. We lost 20 feet of beach in about 18 months. Basically the place was worthless at that point. One day my buddy here in Austin told me he was going on a cruise down to Mexico and he'd be visiting the port city where I had this condo. I asked him to drop by the condo and take a look at a disaster of a piece of real estate. He did. He met the neighbor while there as well. He was a guy named Phil who recently bought into the building AND....he was a retired contractor. BOOM! Game changer. Long story short, Phil came through big time. We skyped several times and when I felt he could be trusted I allowed him to act on my behalf. He booted the squatter, managed some plumbing repairs and eventually also managed about 4k of rehab work. I rented the place a few times but the expats down there extremely fickle wouldn't commit longer than a couple months. So, I finally listed it with a realtor and got rid of that sucker! The day the cash appeared in my bank account was a day to be celebrated! Phil, if you're out there....I love you man!