All Forum Posts by: Jody Powell

Hi BP! I am a first time home buyer and have been working with a mortgage broker for the past 3 months or so. I am currently in escrow, and it dawned on me that I should have shopped around for my mortgage rather than just go to the broker suggested by my realtor. So I stopped in at my Credit Union and sure enough they offer me a better percentage rate (4.125 vs 4.375), no points and pay for the appraisal (saving me $545 in closing costs and a quarter of a percentage point). 

I like my broker, but...

Purchase price of $205k. The loan is conventional, 20% down. ($164k loan)

What would you do? Any mortgage brokers or loan officers want to weigh in? 

I feel bad switching but also feel that I need to be financially smart here. 

Thanks for the roofing information @Hattie Dizmond . The more you know... I am gathering information so I can present a compelling case for my offer. (Even though I am still not sure what my offer will be.) 

I was considering offering them some cash and a "subject to" deal. Any input on how best to present that would be  appreciated. I still need to ask them the pertinent questions of how much they owe and what they need (besides to be out of there by mid October at the latest). 

After seeing the property today, I am unsure how to proceed. They seem desperate to get out, but I feel like I do not know enough to help them out. 

The "new roof" is actually just new shingles over old. The son said it should last another 6 years. I know nothing about roofs, but think that is stretching it. He also mentioned some electrical issues in the garage--I am fairly certain that it had been transformed into a grow room and they just took everything out. There also seems to have been some un-permitted work done--a garage renovation into an extra room and then a new garage built around back. This new garage needed a driveway, so most of the yard is now blacktop. 

After doing some research it seems as if they are asking about what other properties in good repair would sell for. How does one tactfully tell a dying old man that his property is not worth near as much as he is asking?

Any suggestions from BP would be appreciated. 

Today I got a return call from someone who had posted their house (by owner) on craigslist. It is a 3/2 1400 sq ft ranch with a 2 car garage on a large (.19 acre) lot. According to the ad it has recently had new paint inside and out, new carpets, flooring,roof, windows, toilet and lights. It has forced air gas heat. They are asking $220k, but I saw it posted on cl for $191k last month. 

When I spoke with the sellers son, he said that they had a buyer but the financing fell through. He also said that the father is in financial trouble and needs to downsize. They would like to be out next month, or mid October at the latest.  Without seeing the house yet, I am estimating that it is underpriced by $10k-40k just based on my searches over the past few months. The father has owned the home since 1991, but I do not know if he has a mortgage or not. 

I would like to get into this for as little of my own cash as possible, though I do have funds if needed. What options should I be exploring and what questions should I be asking? I am meeting with them to see the house tomorrow after work and this will be my first foray into meeting with sellers. 

@J. Lancaster I have no experience with the company at all. I literally signed up to become a networker and then thought I should ask BP about it. Then their website changed and they (apparently) stopped the program.

@Account Closed I also agree with you--I hadn't noticed they do not identify themselves.

@J. Lancaster I would be interested to see what that letter said.

Also:

The way a networker was supposed to make money was if any of these wholesalers actually did a deal, the networker who first entered the wholesaler onto the list would get a cut of the fee that came out of the assignment fee.

If they are no longer offering EMD funding program, I wonder what they are selling.

@Brett Russell Well, that is interesting. Moot point indeed. I was looking at the database they were collecting from "Networkers"--it currently has 8529 "registered" wholesalers (many of these will be duplicates) that they can now market to. And they got this list for free by advertising it on craigslist as a way to make money. The database I can see as a networker lists the names but not the contact information of these wholesalers.

Anyway, thanks for taking the time to look at it.

@Account Closed I didn't catch that they don't show any contact info.

@Brett Russell Thanks for the reply. I can see why you would be skeptical. I was hoping that someone with experience would reply, also. Just as a counterpoint to the concerns you raise, consider:

• Note that nowhere in their deal standards does it actually talk about the potential for end buyer to make a profit (ie must purchase at least x% below retail). Why? They don't care because they keep your $500 fee if no one will buy it.

They state that recently they added this in order to weed out the bad deals--this seems reasonable as they need to funnel good deals and the originator should have some skin in the game, perhaps.

• but what if the assignment fee was only $3000? Then you actually lose money.

So there exists a lower end cut off where it doesn't make sense to use the service. That makes sense to me.

• their claim to work to help find an end buyer by contacting all their wholesalers would just add another person who is going to get a piece of that assignment fee.

I was assuming that the assignment fee was the originators cash out (minus whatever the EMDFunding charges). The wholesaler cashes out when they turn and sell it to whomever. Am I misunderstanding how that would work? Aren't the wholesalers paying the assignment fee? (You are assigning the contract to them for a fee)

• if the contract is assigned to them, then they could cut you out of the loop.

Why would they do this and ruin their reputation? They want your business.

I understand that this doesn't make any sense in certain cases, but it seems to me as if it would be a good option in the right circumstances.

Maybe someone who has used this or another service like it will chime in. I did notice that EMD Funding is listed as a company here on BP, maybe they will also chime in.

Has anyone here ever used this service, and if so, any feedback?

Their basic premise is:

"Use Our Deposits, POF, and Buyers for ALL of Your Wholesale Offers and Contracts

Unlimited Deposits: We’d like to fund ALL of your earnest money deposits, on ALL of your wholesale contracts, so you never pass on making an offer (or lose a deal) because you can’t get the deposit money to escrow at all, or in time.

Verification of Deposit and Proof of Funds: Get MANY more deals accepted by submitting our VERIFIABLE proof of funds with every all cash offer you make. There’s no cost, and you can use our proof of funds right now…

Buyers: We promote all of your deals to our wholesalers, offering them a fee if they refer an investor who buys your deal. So, by working with us not only can you secure MORE contracts, but you may be able to AUTOMATICALLY sell each contract for substantially MORE than you could sell them for on your own.

Changes Update: As many of you know we recently had to make adjustments to how we operate as too many folks were submitting poor deals that never had a chance of selling. There was no “skin in the game” for these folks so they were inundating us with very marginal deals. To ease the problem we feel it is necessary to charge an up front fee for deals that we accept (though we return twice the amount of this fee to you when the property is assigned to a 3rd party). The good news is that in the process of making these changes we were able to 1) simplify our pricing, 2) eliminate all up front paperwork, and 3) greatly ease deal qualifying requirements. Thank you for your patience and we look forward to partnering with you whenever need us."

I came across them in my research and it seems like a good idea. I signed up as a "Networker" and then thought I should check here since my google fu does not return any reviews of the service.