All Forum Posts by: Andy Collins

I would research your local ordinances, if it requires a permit, make sure they will let you fill it in.  I had a property I had under contract, the city was going to require me to remove every piece of concrete, not just punch holes and fill it in....(and the city had written up the property for a down fence, so they knew exactly what was going on.

I ended up not buying the property for other reasons, but it did double the bid for pool removal since they were having to dig up and haul off everything..now if a permit isn't required....

I would research your local ordinances, if it requires a permit, make sure they will let you fill it in.  I had a property I had under contract, the city was going to require me to remove every piece of concrete, not just punch holes and fill it in....(and the city had written up the property for a down fence, so they knew exactly what was going on.

I ended up not buying the property for other reasons, but it did double the bid for pool removal since they were having to dig up and haul off everything..now if a permit isn't required....

the person that took advantage of someone (or everyone) is the seller,,,I am a little confused how the buyer didn't realize what was going on until after closing,,

First you will always be on the hook personally for the loan until its paid off or refinanced.

The protection you will get from an LLC is not what you think it is if you manage the property, hired the contractor that did the rehab, etc etc.

An LLC is great to be a silent investor in, it will offer protection in such cases, but if your involved in the running of the property, and the loan is in your personal name,,,you will gain very, very little from forming an LLC,,,go get a big umbrella policy, that is your second best form of protection (the first is how you manager your properties)

I would start with the seller that sold him half of a duplex that in many ways didn't exist.

I don't see this being cleared up without lawyers being involved,,tell your friend to go get a good attorney,,,the guy that sold him this should be on the hook if he has any assets (which something tells me he doesn't)

I normally estimate property taxes at 1.7%, in most of DFW that is about right.

Insurance is also extremely high in all of Texas (thanks to the people in Austin).

The best market to invest in is the one you know better,,the difference in two houses, one block apart in the same city and school district can be more than you think, one might be in a 'in demand' high school area, the other one may have students going to a less desirable high school,,,as far as rentals go, the difference in rent rates and how long it takes to fill a vacancy can be affected more than you think by things like that

Unless you lied on the loan paperwork, you shouldn't be responsible for the cash (but yes are responsible to help them clear up any clerical errors, signatures, etc)

They funded the loan and now can't sell it,,I have been in a similar situation,,basically the lenders held the note for a few months to season it and then sold it...I don't know if that would work in your situation.

I would make sure you have always indicated it was an investment property,,if so I would tell them you would sign new papers, etc,,but they should be on the hook, unless they can offer you some special deal on the next loan (if your making one anytime soon)

Try to work it out with them, but I don't think your on the hook for the cash, they should have caught that early in the process, not 10 days later.

The insurance companies aren't worried about what something is worth, but what it will cost to rebuild.

One issue (in Texas and I believe in all states) is if you insure for 40%, lets say you have a loss of $100k (not a total loss), less your deductibe, say $2,500,,,,you think you would get $97,500,,,but that is not true, you are only insuring 40%, so you will get 40% of the $97,500.   

Remember that insurance companies know that it is far more likely to have a less than complete loss,,so you can't insure for 40%, and get them to pay up to that point (did that make sense) unless you have a total loss.

Insurance laws vary from state to state (also rates vary wildly from state to state), so check with another agent in New York.

You may have to pay some fees upfront, such as an appraisal, but I have always paid that to the appraiser, not to the lender.

I've used hard money many times and never paid the lender any money upfront.

andy

You need to talk to a mortgage broker about the refinance before you move forward.    If you have more than 4 mortgages, then this will be treated under the 5-10 mortgage rules, which don't allow a cash out for an investment property, but I believe you can pay cash and finance if done in a certain time frame (I believe 6 months, but again  talk to a broker).