All Forum Posts by: Hoa Nguyen

Hey everyone! Looking to see if any investors out there have used CastleRock REO to purchase a home either cash or via their owner financing option? Would love to hear some insight, experiences, and even alternatives!

Hey everyone, I am looking to invest in other states and do everything remotely. I am looking to BRRRR invest and was wondering the best route to go when buying a property and paying a contractor for rehabs. I have the funding to buy the property, but I don't necessarily have the funds for paying out an external contractor. Looking for some creative financing solutions in regards to the renovation funding.

As an agent who's represented clients who have bought Zillow-owned homes, I'd say it is hit or miss. Each home was represented by a "Zillow Agent" and some agents were willing to work with my clients and some agents were firm. I will say the property type, condition, and listing time also may play a factor. Always try to offer what you want and the worst they can say is "no"

Hey everyone, I have a hypothetical situation that I'd like to present to some people I am currently mentoring. They know how I like to approach investments, but I'd love to get different views and strategies from fellow investors and see what routes of investing different people may take. 

So here is the hypothetical situation: 
You have 20k cash from a refinance on your home. You want to reinvest that into your first real estate investment. With no experience in investing, what would you do with the 20k to grow wealth and capital?

Hey everyone I have a scenario that I'd like some input in. I have a deal on the table. 
$18K Purchase Price
Reno cost $30k
ARV: $80k

I can finance the initial purchase, but I have no funding for the renovations. I reached out to my initial circle with no luck. I also contacted multiple hard money lenders, all of which have said no due to my lack of experience. I really want this deal under my belt. How do you suggest going about this?

Quote from @Steve Vaughan:

Quote from @Hoa Nguyen:

I am seeking owner financing on a single-family deal near me. The seller is up for it, but the mortgage does have a due on sale clause that would stop me from being able to go through with this financing method. What are some ways around due on sale? 

When doing a wrap, it's important that the 1st mortgage is more than 1 year old and there isn't a HELOC on the house. How old is the 1st mortgage? Is there a LOC?

Basically you are hoping the sale isn't discovered. You need to make the payments and be prepared to satisfy if it is called. I make payments electronically through my mgt corp. You may want a holding LLC or similar. Easy to establish outside of CA.

The primary way the transfer is discovered is the change of hazard insurance notification.   Leave the primary borrower on the insurance and just add yourself as additionally insured.  

Research wraps or wrap-around mortgages on here.  They're not common these days but we used to discuss them quite a bit. 

Okay, that's good to know. I guess now my question is, how does a title company play a role? Do I avoid the title company as well? I have always heard that even in owner financing deals its ideal to close the sale through a title company. 

Hey everyone! Quick questions that I am hoping someone with experience in owner financing can answer. I am seeking owner financing on a single-family deal near me. The seller is up for it, but the mortgage does have a due on sale clause that would stop me from being able to go through with this financing method. What are some ways around due on sale? 

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $50,000
Cash invested: $20,000

Bought an FSBO for 50k in 2020, put in an additional 20k for repairs and updates. Was appraised in January 2022 for 170K. Currently residing on it, but plan to flip or rent in near future.

What made you interested in investing in this type of deal?

Wanted to move out of Mom and Dad's basement, but also invest in something that would help me generate wealth down the line.

How did you find this deal and how did you negotiate it?

A FSBO down the road from where my parent's lived. Out of curiosity, I knocked on the door and talked to the owner. He explained that he was just trying to get rid of it for 60k. He was bitter-sweet about selling the property. It was his family home where he raised his sons. After his sons moved out, he rented it to someone who trashed it beyond what he could repair considering his age. I talked it over with my bank and offered him 50k. I also promised to fix it up, which pushed him to accept.

How did you finance this deal?

Reached out to family to help secure downpayment, then negotiated with a local bank to craft a custom "balloon" loan to fit my financing parameters. After a year I refinanced into a convention 30 year fixed at a much lower rate than the previous "balloon" loan.

How did you add value to the deal?

I put 20k (financed through the original lender) into updating the property. New floors, kitchen, bathroom, and paint. Mostly cosmetic. The property was already worth more than the purchase price by 50k according to an intitial appraisal done prior to renovations. Since my wife and I intended to initially live in the property, we decided to make it nice. This in return led to a new appraisal that made the property worth twice what we paid for on paper.

What was the outcome?

I was able to add my first investment to my portfolio. This property generates equity and will soon be the legs upon where I start investing in more rentals. Whether that be via a cash refi, renting out this property, or selling for a profit.

Lessons learned? Challenges?

- Don't be afraid to knock on the doors of FSBOS
- Working on your own (minor) renovations can add great experience knowledge to how that industry works.

In my opinion, it really matters where you are investing. If you are investing in a nicer area, medium to higher-income residents, then a decent sized portfolio of single family homes can be beneficial in two major ways
1. More likely to have better tenants
2. The single-family properties in nicer areas, have better chances of upping their worth and increasing equity down the line. This then sets you up for more financial power in the future. 

The cons:
1. Properties can be higher in price.
2. Properties will be rarer to find. 

On the other hand, you have multifamily units that thrive in lower to the middle-class area. The quality of the tenants is up to you and how you vet. The benefits:
1. Tenants won't be as hard to find.
2. You'd most likely be buying from like-minded investors who are willing to make a deal.
3. Possible HUD funding (guaranteed government rent)

Cons:
1. Property worth won't increase significantly unless you put money into the property and even then it isn't guaranteed.
2. Tenants may be of lower quality (again this depends on how you vet)
3. Larger operation expenses

In the ideal situation, a multifamily unit in a nice area that has a high renter population would be great. But those can be few to none depending on where you invest. 

LLC. Find a good investment/rental-friendly CPA to help structure your business and accounting, but if you can, try to keep all real estate businesses separate from personal life and assets. It's just wiser to have those safeguards in place.