All Forum Posts by: JM Payne

Yes, it is being done.  Ask around your local real estate investing meetup and see if anyone is interested in mentoring you.  It sounds like you have capital, so it should be pretty easy to find someone willing to look over your shoulder and/or provide guidance for a piece of the take.  Meetup and the events page here are good places to start if you aren't aware of a local group.  Best of luck to you!

- jm

Have you been to your local meetups, either in person or via zoom, and asked around for people in your area that are HMLs?  That'd be the first step.  Best of luck.

- jm

Where you know that you are going to need to immediately spend $65k, I would go for a cash out refi in lieu of a heloc.  75% (FoA current maximum) means you can get 262500, call it 185,000 by the time you pay closing costs and pay off your friend, then set aside reserves for your property and take the rest to find a second property.  Best of luck!

- jm

Originally posted by @Kerry Baird:

@JM Payne, do you have a suggestion for the right HELOC lender for this? I called and made a list of lenders that will do HELOCs on investment property, and also continue to see posts where people don't think it is possible. (It is)

I wonder if you use a community bank? A credit union? A big bank?  What is your experience?  My experience is that TD Bank is really friendly for investment HELOCs, and so is PenFed (up to 4 properties) and US Bank. 

My experience was that I went with small, local banks.  As Jeffrey mentioned, terms will be less favorable starting out (65% ltv for the first one we did,) but with experience comes more rope.  Pick a bank you already work with and that knows you, and see what they can offer.  Best of luck!

That's a long list for a 16 year old property, and some of those items (like wall cracks) can be indicative of expensive problems. If you're paying $8k over ask on what I'm assuming is a move in ready-ish property, what is your plan for this property and what are your various exit strategies? Is this a flip? Buy and hold? IS it move in ready or is there a rehab involved that would allow for value add? ARV/target rent rate/etc etc. Feel free to post more info, but my initial thought without more details as to run. Best of luck!

- jm

I've purchased a deal that we hold as a rental from a wholesaler.  Find one that's been in the game for a long time and knows their business, and then treat them fairly and with respect.  In my area, the biggest tell has been whether or not they'll tell you the address.  If I get vague details about the property and bad pictures with no address, then they're new and I have better things to do. 

The guy we work with always has the address ready for me, and he doesn't bother to send me pictures because he knows I'm going to go look at it.  An experienced wholesaler will be able to walk you through the deal just as easily as an agent would.  The other thing I can tell you that sets him apart is the new wholesalers are all on facebook and have bandit signs all over the place.  My guy takes out ads in the paper, so if you see a local classified that says "buying homes," call that guy.  Best of luck!

-jm

Yes it's the same.  There are threads around that talk about how to influence appraisals, but it's the normal stuff; clean up the property, be nice, ask questions, etc.  If you have some comps in mind, you can mention them to the appraiser if you get the vibe that they won't be offended...just generally take an interest and be sociable.  If you've done a recent rehab or improvements, it helps to pass off a scope of work/etc as it's not always apparent that work has been done, especially if it's a property that the particular appraiser hasn't seen before.  Best of luck!

- jm

How did the comps look and did the realtors have any other comps they felt were more appropriate that the appraiser missed?  As to wondering whether the deal is shady or not, the federal government put regulations in place to end any possibility of appraisal/lending shadiness after the recession, but if you asked me to say that out loud, I wouldn't be able to get through it without laughing.

It costs $400 to put your mind at ease and get an independent appraisal.  You've got 5 other offers...fix the items noted on the original appraisal and have it re-appraised independently, then decide if you want to take the 242,500 or go back to market/fall back to a backup offer. 

Alternatively;

You're saving $420 on reduced commissions assuming 6% and not shelling out for concessions, so is the hassle of doing all that and then potentially having to punt this deal and go back to market worth the extra $6500?  Only you can decide.  Whatever you choose, best of luck to you!

- jm

They're just trying to protect themselves...if it's common practice where you are and you want to see the deals, then read it carefully and sign, or learn how to out-hustle the hustlers and find the deals before they do.  Best of luck!

-jm

I'm not in CA, but take a look and do some reading on subject-to financing.  That's likely to be your best bet, as you won't generally be able to qualify for assumption.  Best of luck!

-jm