All Forum Posts by: Chris Smith

@Colleen F. thanks for the reply. Both trailers. Lol not worth the rehab or time. Could raise rent maybe $50/$100 and something to look into if we refi. I didn’t think about gifting a portion of the property or trust. Something I’ll look more into. Thank you again! 

Hi BP: Mom inherited property, paid off, valued at ~$120k. Cash flowing only $600/month due to the other rental house being run down and now unrentable. (there was two)

I'm trying to get creative to leverage the property for further REI. Options I'm trying to consider below—any advice or if I'm missing an option, please reply...

- she cash-out refis and we invest together on something

- she adds me to the title, seasons for 6-months, I cash out refi and invest

- she sells to me under market so I have a safety net of equity in the property, the $600/ pays the note and we use the money on the sale to invest

- she sells and we move on to something else (but uncle lives next door and uses the property for storage, so has talked her into not selling at the moment)

$120k cash is silly sitting there generating $600/month... I'd like to leverage the money. 

Any other options? Or is there a better option over another?

@Nick Trimmer

@Michele B. Thank you. 

@Jessica Zolotorofe Thank you. This makes sense. Just hope we can refi and payback my cousin and get a regular mortgage. 

@Account Closed a cash-out refi makes sense since we own the property with private money. We would need to finance at least what we owe my cousin, 70% - $87,5000 to pay him back. And our cash would remain in acting as the "downpayment" on the new loan? Thank you!

@Michele B. Thanks for the comments. We are looking to making this deal work any day now...My cousin is the wholesaler and willing to sell us the property and hold the note. He will hold 70% of the $125k sale price. $87,5000. We pay him 30% ($37,500) and $729/month for interest. 9 month loan with balloon payment due in 9 months. 

We immediately apply for a commercial loan. One lender said they would lend on the property with a 25% downpayment. Paying my cousin $37,500 (his downpayment) and then in less than 30 days paying a lender 25% of the $125k sale price is a lot of money to fork out to acquire a property. 

In a perfect world, we would go straight to the commercial lender and purchase but since the property is wholesale, my cousin isn't going to hold the property for 45-60 days it will take to close on a commercial loan. 

My challenge is double downpayments. My other question is can we use the equity difference in the property if it were to appraise higher than the $125k. i.e. $30k difference applied towards downpayment if appraised at $155k since technically we would be refi'ing the property since we own with the purchase of private money. 

My partner and I are looking at 6-unit apt. My cousin (wholesaler) is willing to hold the note 70% we pay him 30% and 10% interest monthly on the 70%. We plan to right away apply for commercial lending which will require 25% down. The challenge is paying 30% and then turning around and paying another down payment of 25% within 60 days. Possible to use the equity in the property if it were to appraise for higher than what we purchase it for as a downpayment. 

Technically the commercial application is a refi since we already own the property. I've been told we can't use the equity as towards a downpayment on a new loan but since we own it curious if that is different? I'm open to other creative deal structures or options. Thank you in advance for the words of wisdom.

Hi @Karl Brown are you open to partnering a property? 50/50 equity cashflow possibility? several other options.