All Forum Posts by: Jamal Pitts

I have sold a couple of HUD homes and appraised tons of them prior to HUD putting the property up for sale. They go with the highest net offer. I've never heard of them ever giving a counter offer.

@John Cohen send me a message or email with the addresses.

Hi @John Cohen Good looking out on that title company!!!  I flipped that property I bought at the tax sale a couple of months ago.  Drinks on me next time you in Philly.

I think it depends on the market.  If other rentals are offering it in the neighborhood with similar rents then you might want to consider it.  On the other hand if they don't then don't waste the money.  Also keep in mind if you are paying the water bill the washer machine is going to increase that bill and if you supply those items and they break you will be getting a phone call from the tenants.

I had a couple of tenants where the parents paid the rent and it worked out well on all occasions.  Make sure you check everybody's credit and put the father on the lease. With more people on the hook the better the odds you will receive your rent. 

@Tanikka Myers  I recommend calling some local banks in the area.  With a good credit score and a cash flowing property they might consider it.  Guidelines are always changing.  I also agree with @Matt Motil and @Troy Sheets  they both have valid points, but the bank has the money and calls the shots.

Hi @Tim Porsche

It depends on the bank. Typically the big banks will go off of the purchase price if you own the property under 12 months at 70% to 80% LTV. Which in your scenario would be ($130,000 x 70% = loan amount $91,000 / worst case scenario if they won't go higher then 70%) which wouldn't be enough to pay off the hard money lender because you borrowed 80%.

I recommend going with a local bank for the refinance. They might offer you a portfolio loan( which is not sold on the secondary market) therefore they can be more flexible and base the loan off of the ARV. Which would be $190,000 x 70% = loan amount of $105,000.

The first scenario(going with the big banks) with a loan amount of $91,000 would will not be enough to pay off the hard money lender.

The second scenario(going with the local bank) basing the loan off of the ARV(after repair value) with a loan amount of $105,000 probably still will not cover the cost of the hard money loan once you factor in the points charged.

You getting your cash back is out of the question on all scenarios.

You need to get the property at a lower price, reduce your rehab cost, or locate another deal. 

FYI: I'm basing this off of my market in Philadelphia, your local banks might be different.  It's worth giving them a call to see what they offer to investors.

@Yazeed A. Both of those area's are good for rental's and flips.  I know a couple investors that are doing well in both locations.  I personally invest in University City, never did anything in Manayunk on the investment side; but I have sold and appraised a nice amount of Real Estate in Manayunk.

@Pierre Streat  The Temple area is over saturated. You should look around University of Penn, Drexel, or La Salle

@Damon Lilly  If this house is on the West Philly side by the zoo, I can't see it being worth over $100,000.  $80,000 is even pushing it.  Plus it sounds like the house next door is abandon.  That's a whole new set of issues.  You will have a hard time getting financing ever( not just to buy but trying to refi) or home owner insurance.  Plus it would be an eye sore to GOOD tenants.  I hate to be negative, but I don't see to many positives in this deal, unless it's in Brewerytown; then that changes everything.