All Forum Posts by: Account Closed

@David Faulkner Whoa, No need to be rude and impertinent. "Stick it to the person whose name is on the loan?" 

I think I would decline to work with you or teach you the techniques if that is the kind of thing that pops into your head. That comes from the heart and I don't think I am the one that has the ability to straighten that out.

No, the solutions are rather simple and honest: Exit strategy in the event a DOS is called

1) Cash it out with personal money and pay off the loan

2) Refinance and pay off the underlying loan

3) Get the Tenant Buyer to refinance and pay me off so I can pay off the underlying loan (give a "discount" if necessary for him to qualify)

4) Get a hard money loan and pay off the underlying loan

5) Work out an "assumption" with the note holder (bank) of the underlying loan

6) Have the Tenant Buyer "assume" the loan with the bank

7) Transfer the Deed back to the original seller and assign my interests to him

There are other solutions, but these are sufficient for this discussion.

Now, go wash your mouth out with soap and don't think thoughts like that. ;-)

 Sure,

"A due-on-sale clause is a clause in a loan or promissory note that stipulates that the full balance of the loan *may* be called due (repaid in full) upon sale or transfer of ownership of the property used to secure the note. The lender has the right, but not the obligation, to call the note due in such a circumstance."

DOS is rarely called currently, but in a few years that could change, particularly if interest rates go up significantly.

@Carrie Herrmann When the market is tight in the MLS I got "off market" and do Subject To. I don't know who "Do Hard Money" is, but Subject To is always cheaper.

@Tom R. Welcome. Is there a question in all of that?

@Gail Greenberg  @Irina Belkofer @Bart H.  Gail, Thank you for your compliments. As you can tell, I am open about what I do and how I do it. To your question:

"May I ask what marketing techniques you have found most successful in finding these sellers with low equity in these nice houses?"

My sources and techniques for finding these properties is a little different than most, so I reserve it for coaching students. The techniques work anywhere. It is not as though nobody has ever thought of these sources before; okay some of my sources *are* pretty *creative*   ;-)              but I've counted 105 different ways to find good properties, so there is no shortage. My Profile goes more into all of this. We're not allowed to get too "self promoting" on posts, so visit my profile and send me a colleague request if this interests you.

@Irina Belkofer The bank is not part of the transaction. You have a right to sell your house at any point. They have the right, but don't have to exercise the right, to the DOS. Very few DOS clauses are invoked. Normally, it is only when the mortgage is abused or interest rates go up enough for the bank to think they can make more money by calling the notes and re-lending the money to other people at a higher interest rate that they exercise the DOS. I have not heard of one being exercised in years.

Here is a link to one of the explanations:

https://www.biggerpockets.com/forums/311/topics/47...

@Mary Jo Mertens Arizona is far more landlord friendly and business friendly. I would think that being in King County, you would want to do everything you can to protect yourself from the spread of Seattle's landlord laws and taxes into King Co. It will happen. 

Those are all good questions. I've posted previously on how Subject To works and it should be rewarding to do a Search at BP for "Subject To." or you can send me a colleague request and I'll answer it for you. It is kind of lengthy.

Selling to Tenant Buyers can be a Lease Option that can be 10 years if you want, or longer (Except in Texas). The amount "down" is called an Option Fee, and you can also sell using a Wrap or Land Contract etc. Make the Lease Option as long as the Tenant Buyer wants and extend when requested. I always assume a percentage will not exercise their Option and then I sell the property again and get another Option Fee. When someone does refinance, I get the "back end" of equity that is sitting there. There are so many benefits I stopped doing Fix & Flips and Buy & Holds.

Here is a link to one of the explanations:

https://www.biggerpockets.com/forums/311/topics/47...

@John Powell Burley has a lot of good stuff. Granted, it isn't for everybody. One has to learn a new way of thinking, apply the info and work like a crazy man for about a year. After that, the $15,000 a month in regular cash flow year after year after year is kinda fun. Each additional month adds to the income. But, it isn't for everyone ;-)