All Forum Posts by: Ken Tsui

@Jay Sechowicz

Any advice on auction purchased property? If I buy 10 units at 15k each, could I obtain a blanket loan for $150k and would it be prudent? I assume that would be the best way to structure the loan.

8 of the 10 are currently rented. Currently slum lord rented but I’ve spoken to the community association president who’s been trying to get the owner to sell for years. He said his association would do everything it could to help me renovate and take time and help with bad tenants. I also thought opportunity fund could be great too since I’d probably gut most of them.

I'm a buyer, and I recently got a property under contract, but I am not going through with the purchase after the appraisal came back significantly lower than the agreed upon purchase price.  Neither I nor the seller used a realtor, so I had a lawyer write up the contract and had his title company research the title.  The title company is charging me for preparation of the contract, purchase and review of title abstract, and client communication.

Is this something that I typically would pay if a contract was not completed?  The amount he's charging me is a bit less than the amount stated in the contract that the seller would have had to pay him for the contract set up.

It seems reasonable, but I thought it was worth asking who's cost of doing business this should be - the lawyer/title company, or the buyer?

@Mindy Jensen thanks - definitely will be going through title and getting title insurance if I continue.

You must get this a lot, but it’s nice to interact with such a celebrity!

@Bob Woelfel - great tips! He indeed is the owner, although I don’t know if who I’m speaking with is. I for sure will not hand him any money. Definitely would use a title company. Thanks for the advice!!

@Lynnette E. These are great tips I can put in my tool bag for future purchases. Thanks a lot!

I also just spoke with the property manager who walked through with me. She said she thinks one of the units will be difficult to rent in 2 months if it becomes vacant. Because of that I may pass...

@Amanda G. Thanks, but I am also an accountant by trade so I fear I get analysis paralysis and am very conservative in nature! I am probably going to go through with the deal because I have not found many that make financial sense where I am, and I need to get started! It’s interesting to get different perspectives because many people have told me trust the process - inspection and title work will ensure there’s nothing disastrous.

Are there any known real estate scams involving for sale by owner sellers?

I am a new investor and found an fsbo. It has a very good roi, and the seller said he needs cash for his son’s tuition. If that’s the case why isn’t he using an agent? Seems like he isn’t desperate at the time for the money which is ok.

He noted asking price is 105k, but if we do 100k we probably have a deal. Later in the conversation he said the same thing about 90k. I first thought it was great he was negotiating w himself, but now I’m worried he’s trying to pull a fast one.

It seems like he has done a lot of projects in his day. He said he is retiring to the beach and is buying an expensive property there, so he’s consolidating property into that one.

Next he says he saw a storage property near another investment he has and is kicking the tires there. I asked well why would you buy more if you’re looking for money for your sons college tuition? He says oh well my father has a bunch of money that I can always borrow. I did not ask him why he didn’t borrow the tuition and save a cash flowing property.

I worry he is selling me a money pit. I walked the property w a property manager I will use; she said it seems fine. Rents seem below market and she didn’t see any issues w the property. There were some sloping on the first floor and there’s a crawl basement that didn’t have easy access so I couldn’t see below the first floor for any problem.

I plan to have a title company draw up the contract, perform a title search, and obtain property insurance.

I plan to have an inspection.

not a whole lot of comps but it seems to be in line.

I am currently calling lenders for the best rates, so a lender will get an appraisal too.

property is on public sewer.

Is there anything else for which I should watch out?

I researched a property and submitted an offer - currently it’s being negotiated, and it’s been a couple weeks. As I continued to research the property I found that the adjacent property was marked as a place with environmental interest but just because it’s marked it doesn’t mean it is a violation or dangerous. The note says there is hazardous waste conditional exempt small quantities generate 100 kg or less of hazardous waste per month with some more added on.

Does anyone have experience and would this scare anyone? The property I’m targeting is from the 1920s and I don’t think the seller knew this or thought it was serious or I’d have thought he’d have accepted my original offer or completed negotiations by now.

Are next steps an environmental phase 1 study?

Property listed for $350K

Owner has $180K left on mortgage and noted if I can get him the $180K, he could seller-finance another $120K (Total property cost would be $300K)

Is this legal?  I spoke with a mortgage lender who said they would not want to know about that second mortgage.  I'm trying to figure out why it would matter to the mortgage lender or bank.  They would have the first mortgage on the house.  The seller has the risk here because if something happens, he cannot get the property back, and he may not get paid the rest of the loan he's given to the buyer.

Thoughts?

I am doing the same down in Baltimore and just got quoted 5.3% rate 5.645 APR. Could it have continued to rise that much in 2 weeks!? I feel your pain @Andrew Magnowski!!