All Forum Posts by: Tyler Weaver

Try reading If You Can't Wholesale After This: I've Got Nothing For You.. by Todd Fleming

The way to get started wholesaling is by getting a property under contract.  Then selling that contract.  How you actually achieve this can be done by a variety of different strategies.  There is a common ingredient that they all require a lot of hustle. 

@Tim L. Well, this is outside of my investment rules, banking on appreciation etc. But if population and job growth is projected to out pace new development, and you are currently in the property, it could make sense to hold for a while.  There are risks associated with that though.

I considered buying a condo on the waterfront in San Diego in maybe 2011 or so, and it was about 540k, but last I checked about 2 years ago similar units were selling for about 900k. 

@Thomas Visaggio The seller could still cary back a note on the property either way though. 

This seems kind of like another way to do a land contract, what is different about this strategy vs land contract?  In which case, land contracts are actually pretty common and you will be able to replicate the strategy.

It gives you a bit of a clue on what the rest of the market thinks about the current asking price.  It can either give you a clue that they will be willing to accept a reasonable offer, or that they are being  unreasonable and rejecting every single offer that comes in below asking price.

How did the ARV go from 165k to 225k? Did the original ARV assume the condition was going to be poor at completion of construction?

I would look long and hard into the decision on whether to keep the property and have trouble refinancing or sell it.  You should be able to get a realtor's opinion on the price to help you with determining the current value. 

Maybe see if you can find an investor or property manager in the area and help with turnovers, renovation, or maybe you can offer something on the office side of thing by going through data and compiling reports etc.  

Try to find a meetup in your area and attend that, then go from there.

What are the closing costs you are saving by doing a quitclaim sale and then transfer? Still has recording costs etc.  Is it just the transfer tax on $0 vs $10,000?. 

Am I missing something?

There are complicated rules on what specific banks consider income.  You are probably going to be best served by a local bank that is making portfolio loans.  I remember a banker telling me for conventional loans they consider rental income if you have 2 years track record, and consider any property you have owned for over 2 years.  They also do a pro forma income on any property you have owned for less than 12 months and currently have leased out. (only if you have other rentals for 2+yrs) which leaves a gap between the 12 months and when you have owned it for 2 years.  That was really strange to me.

A local lender is more likely to consider whatever rental history you have in tax returns, your capital reserves, your business plan, and their confidence in the property.  I would start networking with other local investors to get referrals on banks, and try reaching out yourself.  Get everything together, have all your financials, pictures of your rentals before/after, a one page outline of your business plan, and details on a sample property you are looking to get financed.  Start meeting with bankers and see what you can come up with.

It probably will have a hard time appraising for what 2 SFRs on individual parcels will.  

I would go to your local zoning department and see what can be done about it.  Perhaps you can reparcel the land into 2 separate deeds simply by getting it appraised and submitting the legal description.  Perhaps there is an appeals process that it must go through.  

So you will have to put in 12k, and the loan will cost you 11.5k in closing costs.  The savings is 198.26 a month.  Taking 12k off the table and putting it into the loan has opportunity cost.  What that opportunity cost is, is a question for you.

The breakeven point without considering the opportunity cost of the money is:

11500/198.26/12 = 4.8 years

If you are super committed to keeping the loan for the full duration, maybe it is worth it.  Otherwise, the downside is even greater if you were to sell the house in say 2 years. 

This being said, I think you should shop around for a better refinance product with less fees.