All Forum Posts by: Doug Merriott

Do you want to rent it out? Would you manage it in the area it is in? If so offer what you think the house is worth. No way in hell would you pay $200/month in TI payments if you were landlord, something does not seem right about that math. So even if you offer $45k, rent it for $900/month you are doing okay as a 2% rule property. OR if money is the issue wholetail it out to another landlord. 

Why are terms like predatory lending and junk being tossed around? This is the same type of victimhood that made strategic defaults vogue. 

The contract cannot be more clear and it is more clear than the contract on the back of a pawn broker or payday loan company receipt. She gave $5000 in exchange for the right to purchase a home incrementally at a rate of $700/month. $200 every month pays down the principal, now please pull out your 10bii calculators and figure out what principal paydown would be after the 36th month of a 12% interest loan. I think it is about $700... This deal is structured to force some equity. At the end of her five year term she will have $12,000 equity. If she rented what would her monthly rent be? About $900. How much equity would she have in her home after 3 years? ZERO. The contract for purchase or lease option is a great way for those who lack credit to buy in to the American Dream and if they use this initial option period to rebuild their credit then they can and should be able to refinance the property in to a traditional mortgage, if they don't take the opportunity to build credit then they have tossed away $5000 and are no worse for the wear compared to the rental market.

The way I read this story is that someone paid money for the opportunity at home ownership, they do not want it anymore and want to move away. The time to consult a trusted adviser was prior to the purchase of the home. 

Solving everyone's problem could be as easy as offering a low amount for the note and moving on the next property. You will likely be turned down by the note holders, but then again the note holders could be hard up for money and you might be in the right place at the right time. 

Well then, come on down to Clearwater!!!

Small world. @Craig Shrimpton you are from the Berkshires and looking to flip in Clearwater. I left the snow about 10 years ago and have not looked back. 

Honestly, I have looked longingly at a few multi-family properties in Pittsfield as I tried to assist my sister with purchasing a home. I saw a few properties in the spring of 2014 that were blowing the 2% rule out of the water. 

NOT that I am deterring you from coming down to the Sunshine State, Greenfield is just so close to quite a few smaller cities that have to have some potential, all within a one hour or so drive.

Hello @Jessica Aust 

Welcome to Bigger Pockets!!! 

We hold the meeting on the first Sunday of the month at 2:00 pm, Clearwater Countryside Library. 

See you around.

Doug

My recommendation is to rent your home. Most people would kill to have a property only net $645 a month! I prefer to think of rental properties as retirement plans. Gather enough of them and you can live comfortably with an inflation protected asset. You can self-manage or hire a property manager (I know a good one :)), use of a property manager will eliminate most headaches. If you self manage get a good lease, screen aggressively and only collect rent online using something like Sparkrent. I would be happy to go over some local resources with you. Feel free to call or email.

I would be wary of $40k houses in Tampa Bay. You would either be looking at a minimum of $20k in rehab and a bad area or just a really bad area. 

Hey @Mark J. 

I would still recommend 2 out of 3 of those guys. I have a better mortgage guy thanks to another BP member using them to buy 3 rental units using 25% down and extremely competitive rates. I only lack the renovation crew. 

Doug

Ed,

It is great reading this. Having a plan is a huge step for success. Action is the next step. Some really good suggestions have been made here by everyone so far, I am sure more will follow. $80k right out of high school is VERY difficult, but not impossible, one path could be becoming a buyer's agent for a real estate team you are given leads but have to give up a lot of commission. Until that time it would be a very good idea for you to get involved with a real estate office or property management firm, offer what skills you have and start saving every penny.

I look forward to meeting you down here. I happen to think Clearwater is the best city in the Tampa Bay area.

Doug

@Zamir Kazi Thank you so much. True Rent looks pretty cool. We use Buildium for my Property Management office, but I hate it.