All Forum Posts by: Bernie Huckestein

With not being able to charge a late fee in Maine until 15 days past due +  limit of 4%...can I structure the lease amount in the following way: (Example)

Total monthly lease amount of $1,000 due the 1st of the month

10% ($100) discount if rent is received on or before the 5th of the month  --  so $900

If not received by the 5th the rent is $1000 from the 6 - 15th after the 15th the 4% late fee kicks in.

I can't find anything in the regulations about a rent with timely payment discount so I assume I can do this?

Appreciate your help

I found a potential flip property by Driving for Dollars in a small Maine town.  Tracked down the owner, looked at the property and determined it really could work well --  all comes down to price or in this case terms:

The property has an ARV of $140,000 with rehab ~$30

so 140 x .75 - 30 = max offer of $75,000 the owner won't move off of his number of $88K

Not really a deal I want at that number but he is willing to wait for his money until I sell (with a 6 month fence).  Still not sure I can get to the 88 but what advice would there be about this?

If I could keep the house in his name until resold I would avoid initial closing cost / transfer tax etc.  Having him carry the house I would eliminate private money fees for that portion...would then put my own cash into the rehab but still need to account for cost of money.

Aside from the decision about profitability I am concerned about the risk of piling my funds into rehab and then the guy won't close the end deal @ ARV...or in some way hold me hostage for more money later.

I am sure this is done every day but looking for input on how to mitigate the perceived risk...my other options are to a) walk away or b) just make him a take it or leave it option at or around the 75k

Appreciate thoughts --  thanks in advance!

b

Looking to fill my first rental property and looking to confirm the minimum income.

I have read in the BP book that we should look for a minimum gross income of 3x the rent.  My question is if I have two people (not married but both on the lease)...would each person need to have 3x the rent in income (in the event one moves out) or should this be a combined income of 3x?

Thanks, b

It's not completely clear to me as the comments do vary but best I can tell unless you re going to do only 1 or 2 you really shouldn't flip from SDIRA fund...I guess first is that correct?

However, if have a contractor who I know and trust, have the systems in place to find the deals, and have the funds in SDIRA"

1) Could I (the SDIRA) lease option the property to the contractor for a very small amount (plus provide rehab funds)...I would collect a regular interest rate (not as high as hard money) but then share in profits after contractor sells the property for example 80/20 (keep in mind the contractor would be getting paid his normal rate during rehab, I found the property, my SDIRA purchased the property and lent rehab money to the contractor).  --  I am not at all sure this gets me away from an dealer status...does it?

2) As a second alternative I suppose since this contractor would be no relation to me at all I could loan him the money from my SDIRA for purchase and rehab but structure the loan paper to share profits in some way upon sale again 80/20 for examle?  Can something like that work?  

I could be okay with just being a hard money lender but in this case I will have the systems / lead generation to find potential opportunities. My original purpose was to set this up for buy and hold which I will do outside my IRA, I really don;t want to pass on flip opportunities but since I have another full-time W2 job which requires frequent travel -- I don't think I have time to wholesale effectively + that is for sure dealer status.

Appreciate comments, thoughts, or experience the BP community could provide.

Thank you

Couple of questions about the potential for non-recourse loans:

If I were to use my IRA funds to purchase a multi-family property for 360k could I:

1) Have the SDIRA contribute 150K and structure owner finance as non-recourse?

2) if so, my plan is to improve this property (with other SDIRA funds) and sell within 5 years -  then 5 years from now could I wrap the owner finance to the new buyer?

I know I will need some professional help in making sure this is structured property just trying to understand if this is generally doable before pursuing.

Thanks, b

thank yoy

I am getting ready to rent my first property in Maine,  There is a state requirement to have properties tested for Radon Gas every 10 years.  I have had my tested as part of the building inspection and the levels are fine.

I do understand I need to disclose those levels to prospective tenants; however, I also believe I have to register these results with the state.  Can anyone advise if this is true and what the process would be?  I ask my Real Estate Agent (he said I do not) but I don't have a lot of confidence in this guy.

Appreciate any thoughts

@Franky ...I wish I could say that I found a lender this flexible but the truth is not requiring an appraisal was news to me as well.  Here is the situation:

Local bank --  they keep all paper in-house

Will do 80% LTV on 5/1 ARM with 20 year Amort

As long as the purchase price is less than the town assessed value (this was way less) they did their own "Property Evaluation" (no cost)

Although I submitted paperwork the process wasn't anything near normal...we really about 1 week + whatever time it took for the title company to complete the search and we were ready to close...had to wait on HUD of course but we were ready