All Forum Posts by: Varinder Kumar

For my first rental I did a 5% conventional loan 30 years at 3.8% in orange county ca. It was a complete gut job though, something i was not expecting. How ever i was able to get it done thanks to my day job. It did take me 10 months to do it. I now have a $500 cash flow on it. Looking to take advantage of the land size in the coming year and will probably build another unit in the back and rent that out for another 800 a month. Thanks to the ADU law being passed next year in californina, which eases the restrictions on accessory dwelling units, in another words mother in law suites or another unit on the property. The way i look at it theres no need to buy additional SFR when you can just build another unit for about 40k or less and get a 700+ a month rent (depending on where you live). Good luck

it was natural causes

Theres a property that i am interested in investing in. I can go two ways wit it. Either buy and hold or flip it. Its listed about 80k under market value and probably needs about 20k of rehab. The only caveat that someone died in the home recently. They are motivated to sell, im just wondering how this can affect my ARV value? Anyone with experience with purchase?

Tim

When you finance a property for the buyer, your rights depend on the type of financing you offer. Technically, the only type of seller-financing that requires foreclosure is when you actually sell the property and take back a mortgage. Contract for deed seller financing and lease options let you take the property back without going through a formal foreclosure.

If your seller financing is structured as a mortgage or a trust deed, you'll be subject to the same rules as any other lender. While foreclosure laws vary from state to state, you'll usually have to wait for the buyer to start defaulting on payments. Once the buyer doesn't make a few payments, you can send a notice of default. Then, you either publish the foreclosure notice or file a court case. During all of this time, the owner of your home is usually occupying it without paying you. Once the foreclosure process completes, a sale is held and you get the proceeds of the sale while the new buyer gets the property. With time for the original buyer to stay in the house and make up the loan payments, a foreclosure can take anywhere from a few months to well over a year.If you let the buyer finance most of the property but you carried back a second mortgage, you also have the right to foreclose. However, foreclosing on the second usually triggers action from the first mortgage lender. If you don't have the ability to pay off the first, that lender could end up taking all of the proceeds when you send the house to a sheriff's sale, leaving nothing for you.

@Sam Tfaily Is this property still available?

Seller financing is a great. They will get a steady income for the length of the loan. Just make sure you have a good underwriter. Also make sure that you get the price you want in full dont let them convince you that you will get the price you want over time with interest. example of this would be: Buy home for 140 but seller wants 165k. So you offer 140k and do a 5 year carry back and show the seller that over 5 years you would pay 5% of a 100k is $5000 which over 5 years would be $25k so the amount of $160k which seller wanted is paid for in 5 years with interest etc. Instead of paying 160k up front you pay 140k and 25k in interest over 5 years. Then you can sell the home in a year or whenever and pay the seller off at a less amount due to less interest. Example of paying off early: 140k 5% over 5 years equals 165k but if paid in 2 years it would amount to $150k, so you save 15k. 

Its a good strategy for the seller but not for the buyer. They can also add their kids to the loan in case they are afraid of them passing away and the money going no where. Hope this helps.

@mat 

Cool man! Enjoy

@Matt H. 

I believe people dont ask them self enough as to why they are doing what they are. The motive behind their actions is generally influenced by what society is doing. I believe that a lot of people purchase the best of the best when they dont need it, their really paying for a short period of happiness before they start to regret the purchase, and thats not how one should make their financial decisions. If you buy something because your heart desires it then you should enjoy it to the fullest without ever thinking about the cost of financial part of it. example: I like corvettes. But I want top of the line etc but what I am really paying for is a "giggle". A giggle that i can get with a used $25k corvette also. 

So with real estate. People are leveraging HELOC's etc to fund additional properties when their really not going to see a return until 20-30 years of it being paid off. I think its a mental thing to where they believe they have to have to have multiple properties to make them selves feel as if they accomplished something. Any way I dont want to start a coaching session on life etc. But hopefully you get where i am coming from. Trust me i used to be that guy who was willing to leverage against multiple properties to buy more. At the end of the day to each is own.

@Jill Rankin Vega

Feel free to reach out to me if you would like to know the strategy behind why i believe so much in buying free and clear properties.

@Jill Rankin Vega 

Is your SFR in Austin free and clear? If not i would recommend doing clearing it first and then purchasing something else.