All Forum Posts by: Cary Donham

An assignment of contract is just fine as long as you don't mind the investor knowing how much you are making on the property. I do assignments to the investors I have worked with in the past. With most private funds you don't have to worry about the assignment but you may ask the guy if his lender has a problem with an assigment fee.

Thank you Steve!

ROFL! Well if it was my name I could understand the confusion - of course the beard in my photo would give it away.

So this is the same guy that said God would save him and he turns around and does this to the property...... oh the irony.

Yes it's called a pencil and a piece of paper..... you don't really need all these fancy spreadsheets and programs to figure out what price to buy at. Have a simple formula to follow and stay within your numbers.

Let me go just a little bit deaper here..... Dan is correct when he says true market value is what someone is willing to pay for it.

However this would be the case for cash buyers not someone who needs a mortgage. When there is a mortgage involved you will need an appraisal. Appraisers look at comparables. This means houses like you said of similar product sold in the last 3 - 6 months in the same neighborhood or very close within the same square footage and having similar features etc....

For conventional loans there is another issue now with HVCC (Home Valuation Code of Conduct) being passed as law. As a lender you can no longer choose your appraiser.... they have to ordered through companies who use the next available appraiser in line. This means you could get a guy that is green in the field (very likely) because they aren't paying the appraisers the full amount of the appraisal as when we would order it ourselves. That money now has to be split with the company that is overseeing the appraisal order.

They did this to try and prevent over inflation of house prices but what is happening now is these appraisers are coming in and just whipping out the appraisal without any care for accuracy in some instances and devaluing the house and/or neighborhood.

Use comparables on MLS because zillow and other websites like this can be off quite a bit. They should really only be used as a first tool not the final decision. It's the most accurate way I know to valuate a property.

Jon is exactly right in today's market. I do a lot of hard money loans for other investors on my mortgage side of the business. We are now looking at assets to make sure you have enough funds to hold the property should you run into an issue with selling the home and having it listed for an extened period of time. I remember back in the day when I would just put a for sale sign in the front yard and get a buyer in a few days. Ahhhhh the good ol days.......

One thing to keep in mind about the wrap method that Jon mentioned is how your state works or the time frame for foreclosing on the note if the borrower doesn't pay. For example in TX all I have to do is file the NOD 21 days prior to the foreclosure. In other states you have to wait 3 to 9 months before you can foreclose.

Check with a real esate attorney in your area before hand to make sure you are convered in the event you need to foreclose on the property.

I did an owner finance about 2 years ago but structured it as a lease option that would convert to owner financing after they performed. They put 16K down on the property but walked away from it after the first 2 payments! So all I had to do was evict (2 week process in TX) versus having to foreclose.

Hey Jodi - I use 2 local title companies - Federal Title in Mesquite TX & Commerce Title in Grand Prairie.

Federal Title is owned by an attorney/investor/hard money lender.

Christopher:
I haven't had a problem yet with my landtrusts where the lenders are concerned. They like getting the back payments caught up and they like the fact the payments are now being paid on time. We just took one of the lender's non-producing assets that would have gone bad and brought it back to a producing asset again.