All Forum Posts by: Dave Van Horn

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I second @Brandon Hall!

Hi Samuel,

You may be able to structure it where it's quicker and easier if you lend the money to an LLC (as a commercial loan) where the borrower isn't considered an owner occupant. And with a commercial loan, in most states you're allowed to escrow the deed, which is called a deed-in-lieu of foreclosure. That way, a HML doesn't have to go through the foreclosure process and they can record the deed back into their name upon a default. The default timeline in my state is 60 days, for example, where as a normal foreclosure in my state is at least a year.

Personally I usually don't lend to an individual. This is actually pretty commonplace with HML's. Plus, usury laws won't apply in most states if you're lending to an LLC, which allows you to charge the going HML rates.

Best,

Dave

@Justin Hunt

That's correct about the 4-plex. And it could be valid under FHA, my wife and I did just that with my sister-in law. I would run it by a loan officer because there could be something that hinders this strategy (like if you've had an FHA loan in the past or if you currently have one, etc). The "no credit" may be a bigger issue, your brother still may need to meet certain requirements. Again, your loan officer will be able to answer this better than me.

Not an SC investor, so not sure I can speak to the second question. In my experience, the taxes have never changed for me when I've moved out of my owner occupied properties when i've made them rentals.

Best of luck.

Dave

@David Jiang

I would show them the deed. The deed is public record and that way you don't have to show this applicant private info.

@Damani Hamlet

I agree with Jay, most HML's won't touch new construction.

You could try finding private money for the deal, or a construction loan (or partner with a developer/builder). You could also try to find a money partner or high income earner to sign the construction loan in exchange for some upside on the back end. Otherwise, you might want to consider flipping the lot if it makes sense.

Best,

Dave

That budget may not last long considering this type of marketing needs to be ongoing to increase your success rate but I'd suggest:

- business cards

- car magnets

- bandit signs

- and consistent direct mail to motivated sellers.

Another strategy would be to team up with another wholesaler and split the marketing expense.

Best of luck!

- Dave

Hi Justin,

I'm not an accountant but I believe the commission and any improvements can reduce the gain but not sure if you can get around the 2 year stipulation. I would suggest contacting an accountant to see if there's a work around.

Also, may want to consider if you have any losses anywhere else that could offset the gain.

Best,

Dave

@Natalie Kolodij

The potential of a relatively quick flip is really based on the market, so like Justin said...it's mostly icing on the cake if the market allows for it. Cashflow is a necessity.

Best,

Dave