All Forum Posts by: Bernard Chouinard

I was looking at a REO House on auction.com but the previous owner is still living in it. How horrible is the eviction process in Massachusetts with this situation? Is it the same process as a rental eviction? Or since this is a foreclosure are they illegally squatting and can be legally removed right away?

I understand I should be asking a lawyer but wanted to hear of my fellow BPs opinion and experience. 

So I have an old 401K I'd like to convert to a SDIRA but Fidelity doesn't offer this.  I'm in Central Massachusetts.  Any recommendations on does out there? 

Thanks @Ned Carey, real newbie question here.  Would an attorney act as a title/escrow company? 

4 Owners of this 2 unit 3 br property.  Wow very long story will do my best to make it as short as possible. Changed the names just in case. .lol 

Owner 1: Carol, took a 2nd mortgage on her house to buy her daughter (Owner 2, Jen) and husband (owner 3, Bob) a multi unit and have Bobs mother also live in one of the units who is also Owner 4: Lori. 

Toxic relationship this is.  Poor Cindy has the mortgage but no vested interest in the property other than trying to help family out.   No one pays, no taxes were ever paid (bought in 2010) Bob/Jen now divorced.  Squatters are living in the building, bob and Lori are refusing to do much with the building. 

Town has a lien on the property now.  $31K needs to be paid to get taxes caught up plus  $900 in back water/sewer.   Town has this with their attorney to process and should be taking the property shortly. 

All 4 will lose this property regardless.  I've put an offer out there for them to give them each $1,000 to sign the deed over to me and I'll pay the back taxes.  So for under $40 I'll get this property.  Repairs are unknown at the moment so that will play a role int his of course.  But the property exterior seems good.  

My question to you BP community as this is really my first deal.  How should I approach this and what steps should I take for the process, transactions and to protect myself. 

Should I just a purchase agreement on the $1K each?  

Should I have an attorney be there for the deed signing? 

I should have more questions but I don't know what I don't know so looking for you on this.  If it matters property is located in Winchendon Massachusetts.  Not my ideal place to invest but if the numbers work then it doesn't matter to me. 

Our primary residence is 100% under my wife's name.  Would the interest be tax deductible if she pulls equity out via line of credit or 2nd mortgage then provides me with a personal loan with a set interest rate?  If not then would the interest rate of the 2nd mortgage/line of credit be tax deductible? 

Dan M. Thank you for the info really good suggestions.  I should have been clearer in my question.  The family member is a nephew in law who wants to partner up with me.  He has a very sizable 401K with his currently employer although I'm not entirely sure how that work work as he's a Steel Worker for the Union.  But it does sound like he would not be able to use that 401K (converting to a SDIRA) other than taking a loan out against the 401K. 

Mark Nolan Thanks.  As I was saying to Dan I should have clarified as I'm looking for a way for someone to utilize their existing 401K by converting to a SDIRA.  A 401K loan is always an option of course. 

Trying to get off the ground and have about $18K in a 401K that can be converted to an IRA. Now I need to find short term private funding to help with the down payment with the goal in mind of refi in 6-12 months and pay them back.

So with this said, before I have these conversations with family members. Can any 401K be converted to a self directed IRA?

I really don’t’ know if this is appropriate but I figured what the hell. I’ve seen similar “journey” type posts in other forums figured I’d try it here. Hoping it will help you give me some input/insight as well as keep me accountable. I’m not a writer by any means so please forgive the grammar or possible long windedness to my point.

Today, I'm a REI wanna be much like many others. I'm determined to not be part of the wave that shows up, gets excited and does nothing. My goal is to start with Buy/Hold becoming a landlord, flip for fun and focus on distressed single family acquisitions for resell and possible mortgage wrap. My REI interested started years ago (early 2000's) with the flip shows but nothing came of that. I'm I sell enterprise software to billion dollar corporations and always looking to improve my sales game so I make use my 1.5-2 hr commute and dedicate it to sales audio books and pod casts but managed to have found myself listening to REI podcasts then introduced to bigger pockets and I was like a little kid that couldn't get enough. In total 180 pod casts, 6 books, 7 networking groups and still counting. I've met wonderful investors and keep in constant contact with a few as well as have a go to mentor who started this 1 year ago last month and now has 50 units under them. I picture this my full-time job to the point of being able to put employees to work to help me in my business. But first I must take action besides looking at the MLS and seeing if I can make the numbers work.

I started calling for rent ads on CL asking if they ever thought of selling. Sure enough I found a lovely woman who lives 2.5 hrs from the 4 unit (3br, 2br, 2br, 2br) building she owns in Oxford Massachusetts. She bought it 2 years ago with a partnership that went bad. She’s tired of the management a building so far away and wants to focus on her family. I find myself trying to make the numbers work and would love your input on what you think of the numbers.

Assuming all are 2BR, even though she claims 1 is a 3br and says there’s enough room to make all of them 3br but we need to work with what we have now, not what it could be right? So I would say $925/Unit for 4 unit for Gross Rev of $3700 putting this at 1.42% of the 2% rule. Maybe I can strong arm her down another $10K and there’s the possibility of these being converted to 3br’s But 1.42% is what I have to work with today.

What do you think of this deal?

Next comes the money I would love to find a private lender to avoid going through a bank. My boss offered but I’d like to keep that separate and I’ve reached out to folks in the past who’ve expressed interest but no one as of today. Worst cast I get a conventional loan. So we’re talking 25% down right which is about $65K. I can probably pull that together but it pretty much eats up all my reserves for emergencies and repairs to the units as they are not in need of repair but certainly dated. I’ve sent the following letter to an older co worker of mine who wants to be what he calls an “arm rest” investor. Looking for a very hands off investments but not sure if he would be interested as he has 21 units under him as a private lender/investor and so far, has been burned by the lack of due diligence his partner is putting into these purchases. Here’s the email I sent him feel free to comment. 

• 1. Private lender: I would come to you for any help needed for down payments and repairs if/when needed. You would be paid back plus a predetermined interest rate. You would be kept involved and updated with all projects and purchases but would not have any properties in your name.
• 2.Private Lender/Partial Owner: All properties are placed under an LLC with both us as beneficiaries. Most of the funding would be supplied by you and paid back with a predetermined interest rate. I would handle the day to day, operations, marketing acquisitions etc. Ownership of the LLC would be 50/50, all profits after expenses, (PITI, CapEx, Repairs, property management, payroll etc).

So you're driving for $$ or just happen to see a property and think that might be an opportunity there.  How do you go about (In Massachusetts) finding the owner of that property to contact them?  What is your method? 

http://www.realtor.com/realestateandhomes-detail/4...

Loving this multi, but with get started with BRRRR would be awesome to use this to jump into the game as a first buy but with it being a fixer. Is a conventional loan out and partnering up my only option? Don't get me wrong I'm certainly open to partner/private lender I just don't know anyone yet so figured if I have to do it the conventional way to get going then so be it. The owner of my company has offered to partner with me but I'd rather not since I do work for him but I'll keep that option in my pocket for future opps.