All Forum Posts by: Alma Mills

All advice is appreciated but would love to hear more about how to purchase a this type of property with creative financing ie. little to no money down. If we can negotiate it to a lower price etc.

Certainly all valid points, its not a smokin deal at that price. Pro forma is $4500 a month in rents but that is not all true as the front house on property is owner occupied. What the condition will be like inside is yet to be determined, just trying to find out how I could pick it up even if the price were 500k. My best assumption is it needs some work but this is an area that is on the way up in value - over 50% increase in value year to year so if it only cash flows a little it will still be a wise decision. I am hoping the fact that is has been on the market for some time will motivate the seller to be flexible in price/finacing etc.

@Rick Bagenstoss,

Partner might be a good way to go. When you mention contingent contract what are you referring to? I am hoping the seller will be willing to be creative as they are currently asking for more than most want to pay. I am not sure what the deal will look like. I guess I would need a private lender to lend the remainder of the purchase if I assumed the sellers mortgage as I would not be able to get a new mortgage on the property right? If I got the seller to finance part of the purchase I suppose I would still need private money to pay off his note right?

So here is the potential deal, love to hear any ideas. Purchase price is 600k on 3 unit property that should cash flow. I am trying to find out what is the best way to finance it either for short term (flip) or long term(30 years). Price is maybe a little high and that is why it has been sitting on MLS for about 200 days. It probably needs a lot of work. Owners only owe about 250k on the property so have some significant equity. What would you suggest is a good way to get the property with little money down?

My mortgage broker tells me that the owners can't give me the 25% down needed for down payment like it was done in the past. If the seller is willing to have me assume the loan what would be ways to pay them the remaining balance? If they are willing to give me seller financing what would be ways to pay off their loan? Or are their other ways to pick up this property? Thanks for your help.

@Trent Currie Project to project basis to buy individual properties and repair them. I would like to simply use their funds to purchase and repair the places and then if possible refinance them but with the way lenders are these days I am unsure if I will be able to get the traditional financing especially as we already have a couple of properties. Not sure if the Debt to Income ratios will be what the lender will want. That said I am confident that we can purchase the places and remodel them and have the 25% equity needed for the refinance and pay off of the private lenders and the properties will cash flow or we would not keep them.

@Trent Currie the lenders are friends/family that have funds and I would be borrowing the money to purchase distressed properties in my area then rehab and rent them out or sell them depending on the situation. I would like to be able to rent them for positive cash flow with the Private money would like to be able to move the financing to conventional loans at some point.

@Ellis San Jose so what is a call provision? I don't like balloons either but don't think my lenders want to wait 30 years for their money back.

All good stuff...so do you normally pay points too? Is a 5 year term amortized over 30 years with a ballon payment at the end typical? Seems like if you pay 12% and paid points it would be quite comparable to a Hard Money Loan wouldn't it?

What do you think are reasonable rates and terms to charge private lenders I know. Giving them 1st position on a property where they will be lending no more than 70% of the ARV.

Thanks for all the ideas and interest guys, I will put on the Los Angeles in my keyword alert Brandon.

So we are interested mostly in 2 to 4 unit properties that will cash flow at $1000 a month or so. I took a RE investment course at El Camino College a few years back and loved a book recommended called "Buy and Hold:7 steps to a real estate fortune" by David Schumacher. It's all about buying in areas where you see the signs of future growth. So I have found our area and we are now looking at the best ways to pick up properties without much money down. As our area is only about 20 to 30 blocks and most are single family homes (something we like) very few are on the market that fit our criteria etc. Additionally we put down a lot of money on our home (4 unit property with house and 3 units in rear) so we are now using Property Radar to find out who owns their home, who is in foreclosure etc to approach them for no or low money down purchases. I actually am looking at a SFR that appears vacant and will be at auction in a few weeks that I would like to purchase and rehab near my place. So basically I am trying to learn about how to best use multiple methods of purchasing as the number of properties that fit our criteria are limited.

@Karen Margrave thanks for your comments and questions, we are looking for hard money lenders or private money lenders that would be willing to fund up to 65% ARV - I have spoken to 2 kinds those who wanted us to put down a huge down payment irregardless of the ARV and another who was willing to loan up to 65% of the ARV for purchase and remodel without down payment requirements- would love to find more of the latter that lend in LA area or Private money lenders that would be willing carry the loan a little longer and without as many fees if you know of some.

Would love to learn from those who have done owner carry deals or negotiations with pre foreclosure or foreclosure owners etc. I could go on with questions but that is probably enough for now ;) thanks

http://www.amazon.com/Buy-Hold-Steps-Estate-Fortune/dp/0970116209

Hello really glad to find a group where I can learn a lot about real estate investing. We like using creative financing to purchase distressed properties for buy and hold investing (cash flow). Seeking to meet lenders, other RE professionals etc. We are focused on a specific area of Los Angeles.