All Forum Posts by: Ken M.

Ken M. has started 149 posts and replied 1757 times.

Question I have a duplex that is paid off. I listed it for sale and haven't had a lot of action on it. Its paid off already. Can I sell it and offer like a 5.5% interest rate and carry the deed for the house? Lets say I sell it for 500,000 thousand and require 20% down and charge 5.5% or 6% interest rate on the remaining balance? Just curious if this is something I can do individually?

thanks

Ian

Yes, you can do that. But as has already been mentioned, you should have someone you trust help you work out the details. There are plenty of details.

1 Vote

Quote from @Anaujah Curry:

I am 26 years old, an extremely beginner into the real estate industry. I am looking to invest, should i consider multi family units ( duplexes) or single home where I would fix and flip?

I am in Charlotte, NC

Depends, how much do you know about the working end of a hammer? How much do you know about paint selection? How much do you know about bottom line profit? Are you better with a calculator or a square? What do you want to become?

1 Vote

Charlotte, North Carolina

Quote from @Joseph Scorese:

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Hi @Joseph Scorese:, I'm curious, as far as I understand, Bankers, loan officers, real estate agents and a few other specialties require a background check to perform their job. SubTo is legal of course, when done legally, but if someone gets into a lawsuit over a SubTo transaction and loses, will those individuals still pass clearance for their license?

0 Votes

Norwalk, Connecticut

Quote from @Mike Terry:

What do you do to protect yourself from "due on Sales Clause"? Lenders in a declining market want ehir 2-3% money back when they can relend it at 7%. They will call the note.

Good question.
That is why I get the big bucks to coach people.
But, I've written about it extensively here on BP.

The kicker is that there isn't a universal answer. It varies by circumstance, borrower, lender, type of loan, and a few other factors. Transferring it back to the seller is ALSO a violation of the DOS. Buying it in a Trust is ALSO a violation of the DOS. Using an Executory contract is ALSO a violation of the DOS. Due on Sale insurance does not exist, it's fraudulent. There is no magic bullet. It is how you deal with DOS when it happens, that either gets you sued or keeps you from getting sued.

The guru on youtube who says he has a solution for DOS recently said he had 10 DOS called. I checked and he solved the problem by borrowing money to pay off the loans. If he is so good at this, why did he have those called? He was fortunate to be in a position to borrow the money to pay off the lenders. He likely damaged the credit of the borrowers during that time. Which can lead to a lawsuit. Most people doing SubTo in his group are not positioned to borrow enough to pay off the existing loan. They are broke. With no money. With bad credit.

I've had two DOS called in 30 years. One in 2008 and one in 2020. I've been as far as the Ninth District court litigating "Subject To" and won. Don't go that route. :-) It took 6 years and was mega expensive. But, I won. It may have changed the law in how foreclosures are handled.

Can you prevent DOS? Yes, by never doing a "Subject To" is a good start to accomplish that, if that is your goal.
However, are there ways to greatly reduce the DOS and professional ways to deal with it if/when it happens, yes.

0 Votes

Quote from @Marcus Auerbach:

Quote from @Ken M.:

Quote from @Marcus Auerbach:

Quote from @Brett Romero:

Hi. Does anyone know of a freelance-based real estate coach that I can utilize on an hourly basis? I'm looking for help with analyzing properties for long-term rentals. All of my searches keep bringing up real estate programs that you have to pay $100s/month for to get any kind of coaching. That's overkill for my needs. I'm not a real estate agent and not looking for marketing type help.

Thanks,
Brett

REI is not rocket science. You don't need a coach. And I'd argue you don't want one. If you feel like it's a knowledge issue, then read REI books. And if you feel you need someone to hold your hand then you are not ready mentally.

If you look at listings every day for an hour, you are a local expert within a month. It is really a mental journey; before you can be a real estate investor in the real world, you have to become one in your head.

$100/mo is going to buy you a dude in a call center reading script. At best. Here on BP you have plenty of people with 7 and 8 figure net worth, who will spend an hour answering your questions for free - just because they love it and want to see you succeed!

I understand your sentiment, better to get started rather than worry so much.
He wants to have long term rentals.

But, I don't think you can learn how to deal with tenants, landlord tenant law, collecting rents, evictions, cashflow, contracts, capital expenditures, marketing, clogged toilets, lead paint hazards, dog bites, lot lines, and on and on from reviewing listings.

He has a valid concern. He doesn't know what he doesn't know.

Joining a REI group for $20 a month is his best approach IMHO. (NationalREIA.org) Over time, he will have what he needs,

However, I think he wants to avoid the trauma of lawsuits, police visits to the property and 3:00am phone calls. ;-)

Having rentals is not a walk in the park.

Not what I said!

If you lack the knowledge, read books until you get to the point where it get's repetitive and you don't learn anything new. If you only read what's in the BP book store you know more than the average investor.

If someone is asking me for help, my first question is always which REI books have you read? If the answer is none or RichDad-PoorDad I'll give them a list and tell them to come back with questions once they know something.

No coach is going to sit there and tell you for hours on end about how to deal with tenants, landlord tenant law, collecting rents, evictions, cashflow, contracts, capital expenditures, marketing, clogged toilets, lead paint hazards, dog bites and lot lines

And if you stay clear of the hood, you won't have to deal with police visits and 3am phone calls, I have not had one in 15 years

Your comment: "You don't need a coach." and "No coach is going to sit there and tell you for hours on end about how to deal with tenants, landlord tenant law, collecting rents, evictions, cashflow, contracts, capital expenditures, marketing, clogged toilets, lead paint hazards, dog bites and lot lines"

Well, yes . . . I do.

Every one of my students gets two hours a week and unlimited calls to go over all of those things. But, it costs money.

Now, if you say "no coach will do that for "free", you are likely correct"

Some people don't need that kind of help, but it's available for those that do, that have resources to pay for it, that are serious about being successful and will put in the effort.

Just two other thoughts

1. Not everyone is a book learner, some are lecture learner, some are hands on learners.

2. Where is the hood? Does a new guy know which side of which street to stay away from or even how to determine that answer?

0 Votes

Quote from @Colleen F.:

@Ken M. You also have to wonder if you are going to see a Canadian sell-off. We have met a few Canadians who were selling and plan to stay in Canada. However I also see homes listing in the suburbs of Phoenix for higher prices. It is a hard market to read.

Word is some Canadians are taking their ball and going home. But, I haven't run into that yet.
Our various Canadian neighbors are more concerned about free speech issues in their native home land.

0 Votes

Quote from @Robert Shreffler:

I think @Ken M. means not joining AZREIA but paying $20 to attend a monthly meeting. I have joined them for 2 annual memberships over the years but did not gain enough business to continue. They had some good sub groups that meet to discuss buy and hold etc. But to continue paying annual membership, I did not get the value like making connections that matter.

Your comment: "did not gain enough business to continue."

I agree, that I would not think that a realtor would find leads to list there. Burt contacts lead to contacts which lead to leads. I wasn't actually thinking in terms of gaining business.

I am not a realtor, so I look at it from the gaining contacts and knowledge, market updates, partners, sources, friends and things like that. Other investors may be doing something I haven't thought of.

There are about 2,000 members, or there were, it may have declined with the market change I don't know, but there are insurance sources, money sources, title companies, contractors, flippers, landlords and so on.

And just some pretty fine people.

0 Votes

Quote from @Robert Shreffler:

Thanks Ken. Like you knew about the stagnation in the county. How are we to learn that stuff? That's what I mean about there is nothing here in "Market trends". I don't know where you got your data, but there's none here. I wish there was.

I use ATTOM, Corelogic, Redfin, Zillow, www reventure.app, Zerohedge and a couple of sources that cost money. None of them are absolutely correct, so like all things, you have to sort through the noise to find what you want.

You can use "real estate market trends Phoenix" in a search engine to get the basics

0 Votes

Mesa, Arizona

Quote from @James Hamling:

Ok @Ken M. I got a ? for ya.

And it seems that about 98% of time I mention it people get triggered and defensive for some reason.....

In the realm of residential, why do SubTo vs Contract For Deed?

I simply do not see or comprehend any merits of doing SubTo vs C4D. And I see many reasons for doing C4D vs SubTo.

You want to buy with limited $ down..... Ok, you can do a C4D with as little as $1.00 down.

You plan to leave sellers financing as-is.... Ok, you can do that with C4D.

Control of the property, ability to reno it, lease it, sell it retail..... All these things are readily available with C4D.

You know what you don't get with C4D, the very real risk and concern of financing calling DOS. Or having to find some back alley person under cloak of dark to agree to facilitate closing. Or fears of the multitude of other concerns connected to SubTo.

C4D has been around for ever. It's not rare odd or unique, it's time tested and so normalized that it even has NAR issued standard template forms. It's simple to do, simple to close.....

I am always befuddled why there is such rave over SubTo and all but 0-anything for C4D.

.
Your question is a very good question: "in the realm of residential, why do SubTo vs Contract For Deed?"

Because a guru on youtube told them that with SubTo they can do zero down, no money needed SubTo with no obligation and no consequences and become rich for only $12,000 tuition. According to the video, he also saves money by doing the closings in the home of the seller without using escrow. Since homeowners don't have a clue how risky all of that is, they are relieved to no longer have to make payments not thinking of the consequences. That is one reason I believe a lot of SubTo transactions will become lawsuits.

I call SubTo a very sad scam.

Now, traditional "Subject To", very different these days from SubTo, has a very thin sliver of use in real estate.

Some investors might choose "Subject To" over CFD or Deed of Trust either from laziness, lack of knowledge, being cheap, or in more sinister circumstances, to defraud the seller. But it should not be the "go to" technique.

One way that I have used it, is to stop a foreclosure that is only days away. There isn't time for the proper process and if I'm putting $20,000 in to stop the sale, I want something for the risk. In our case, we give the seller cash for their equity and if it is substantial equity we might put some of it in a promissory note. Then I'm out of the "Subject To" as quickly as possible by selling or it gets rewritten as a Deed of Trust. "Subject To" becomes a place holder, not a permanent financing.

That doesn't always work out though, we just did a "Subject To" where we put $16,000 toward the foreclosure and $10,000 cash to the seller, but it was taken to sale anyway. Now I have to go through the process of getting the sale unwound which includes dealing with the guy who won the bid. It's a real mess. It's happened before, so I'm accustomed with dealing with these types of issues. I can guarantee you, that someone in the guru's SubTo community would not be able to or is positioned to resolve this kind of issue.

Creative financing takes money, experience and risk and knowing which Creative financing technique to use based on the circumstances, the lender, the seller's goals, your goals for the property and so on.

Back to your question "in the realm of residential, why do SubTo vs Contract For Deed?'
They shouldn't use SubTo, likely not at all.

Only fools believe the hype from the guru on youtube. That will be coming to light during the next downturn in real estate. They didn't believe the Titanic could be sunk until it hit an ice berg.

1 Vote

Quote from @Owen Rosen:

Ken, are you familiar with the Dunning-Kruger effect? Read up on it. How about the fallacy of anecdotal evidence? Check that out too.

Your verbatim comment:

"I have not seen nor heard of an insurance company paying 100% to make an insured whole.
I'd love to hear the story and circumstances if someone has one."

So, yeah, my question about the $7,000 or $12,000 and paying for the repairs holds.

Since you're likely to reply with more incoherent nonsense, I won't be replying any more unless anyone has honest questions like the original poster and many of the other great people on this forum. I apologize for wasting everyone's time engaging.

Also, @Ken M. I hope you have good insurance because I don't appreciate being called dishonest WHEN YOU DON'T KNOW WHO I AM OR HAVE ANY BUSINESS WITH ME because you're going to get your self sued.

Nah, quoting what someone said about me is not a suable offense. You're more likely to be removed from the forum for liable. I suggest you stop before you dig yourself in deeper.

0 Votes

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All Forum Posts by: Ken M.

Ken M. has started 149 posts and replied 1757 times.

Post: Can i sell my duplex that is paid off and offer financing to the buyer?

Post: Should a no experience investor start with fix and flip or fix and rent?

Post: "Declaration of Independence - Cutting the Cord with Your W2"

Post: In the last two months I’ve bought 3 Subject To's for less than 85% of ARV each.

Post: How to find a real estate coach

Post: Phoenix housing market softens as spring selling season fails to ignite

Post: Phoenix housing market softens as spring selling season fails to ignite

Post: what? no posts?

Post: Creative Financing Thoughts

Post: Trying to do the right thing regarding an insurance claim