All Forum Posts by: Dan Maciejewski

Often people will pay more that the appraised value. The only people that technically can't pay more than appraisal are the ones that are putting every cent on the down payment AND have a very high (maxed out) loan to value ratio, ie FHA and VA buyers.

If you are putting 20% down on a house but the lender will lend 95% LTV, an appraisal that comes in 3% low only changes the LTV from 80% to 83%. If the buyer chooses to not pay more to keep the LTV 80%, then their payment changes a bit. They can also add more money.

Then there are cash buyers.  They don't care about appraisals.  Some agents like to tell sellers that cash buyers are more likely to get an appraisal, but in my experience, anyone that can amass a few hundred thousand to millions in cash is pretty confident that they can value their own purchases.  

I'm not sure about your market, but in Pinellas county (Tampa Bay region, beaches), they are very hot right now.  As in I wish there were more people doing the work -- inventory is very low way up into the millions price ranges.

In the last 30 days we had 101 closings priced between 1-3 million with a median days to contract of 6 days and an average of 72.  The median sales price was 100% of list price and an average of 99.2%.  There are currently 173 for sale in that price range -- that means it's 1.7 months of inventory, which is a strong sellers market.  Less demand than for the average priced house but not much!  Normally we see those price ranges with over a year's worth of inventory.

The vast majority of these were cash sales, as well.  All in all I'd say that is a solid market to get into!

If you can convince a seller to hold a note, an option is to have a seller-financed note for 3-7 years, interest-only, with a 30 year amortization.  Sometimes you can get one with no pre-payment penalty.  The balance will be due at the end of the interest-only period, which means you'll need cash or another loan.  This is still good as long as it doesn't negatively amortize.

You will have small payments, the seller will have cash flow, and you have time to qualify for a conventional loan to refinance out.   

Many people will tell you that sellers don't want to finance. I just found 27 opportunities on my MLS in my county, priced from 70k to 4.8 million. Obviously they will have their own terms they want and they will want to underwrite you, but it's an option.

There are 2 main options.  A Lease Option or Seller Financing.  

A lease option would give them the option to purchase at a set price within a certain timeframe.  That would give her the time to get qualified so a lender would underwrite her.  She would have the peace of mind to know you aren't going to sell form underneath her and you would have the knowledge that you "could" have a buyer by a certain date.  You are also still the owner and landlord and responsible for maintenance.  Usually there's an option fee, or you could up the lease a little to charge for the option.

Seller Financing means you underwrite her and write and hold (or sell) the note.  She becomes the owner (at least in my state) and you become the lender.  If she defaults, you have the same options as any lender -- foreclosure.  In this scenario she is responsible for all maintenance (most fully amortized mortgages specify the level of upkeep required).

Your state should have a standard contract for either scenario.  You will want an attorney to draw up the note and purchase and sale contract or lease option contract.

I mean. .  . Why would you want  a camera in the basement?  To be able to tell who breaks the window the next time it breaks?  So you're going to install a camera in a rental duplex basement and point it at a window?  Something doesn't seem right there. .  .

Legally, my guess is you probably could, but why would you want to?  It's like $50-100 to have a guy come out to fix it -- probably $10 if you buy just the custom cut glass and fix it yourself.  

If you're really worried about the window, you might be on better footing putting a camera outside, in definite common area and point it at the window.  Then you are actually looking for anyone, tenant or burglar that could be breaking the windows. .  .  Inside, it seems like you just want to keep tabs on the tenants. . . 

EDIT: 

I see you live in the other half.  Seems even more weird in that situation.  Whether your intentions are iffy or not, I'd stay way on the side of not nad NOT put any cameras up to spy on tenants!

Here is a google search with a bunch of opinions. . . 

I am not Not a lawyer!  BUT the first thing any lawyer or judge will ask is, "What does the contract say?"  

If you don't want them to renew, I'd start by just telling them that you made other arrangements and they need to be out by _/__/_.  

In the current pistachio, getting them out based on their contractual obligation may be harder or easier depending on local jurisdiction.  Some places are business as usual, and some are VERY insistent that you work with the tenants.  I know nothing of your area -- ask some locals what they are seeing.

Definitely would need to know the purchase price, loan type and amount, and closing date.  The transfer taxes (deed tax and mortgage stamp tax) and title insurance are based on percentages.  

If you have a loan, the lender will require prepaids in escrow -- Insurance, taxes, interest, rents sometimes if it's a rental property.  You may have to pay a loan origination fee, and sometimes your appraisal is rolled into closing costs.  Survey will usually be in the closing costs, as well. Taxes are paid in arrears, so they get paid differently by the buyer or seller depending on when in the year you buy.

As far as over asking -- look and see what the market s bearing right now.  It will be different for different areas and price points.  

Lower price points (below 400k) in my area are not too bad due to the financing and appraisal issues.  When you get into the average and higher prices where cash is king, you are seeing about 10-15% above ask.  That is if ask is reasonable to the current market.  When you ask more than 15% above comps, you see a huge slowdown in offers and above-ask offers.

I'm pretty sure leaving a note or doorhanger is legal.  Or at least not prosecuted.  Pizza restaurants do it all the time.  

As far as effective, who knows?  You should be able to find the ownership mailing address in the tax records -- that might be a little more effective.  Everyone that direct mails says handwritten notes get the best response.  I get about 10% when I send them -- way better than mass-mailed postcards!

 I am not a lawyer and you will need to consult with a lawyer for legal advice.  

As I said, there is no "middle ground."  There will be no credit.  Either you buy the house or you don't.  If you don't, my advice was to try to get your deposit back.  Contractually, you have no right to it, but they may just release it.  If they don't you could drag them into a legal battle to fight for it.  If you go that route, be advised that they have way more money than you.  They do have a reputation to uphold, though, so they may not want to fight over your small deposit

As far as small claims court -- check your local jurisdiction.  Usually it's $5k or less.