All Forum Posts by: Kurt Brumfield

@Ron Woods, @Andrew Syrios, @Christine T.

Thanks for the kind words. I am happy to say that we finally closed the deal yesterday. What seemed like a quick turn wasn't. We bought this property on Jan 5 2016 and had it under contract Jan 14 2016. Buyer's first lender (FHA loan) was declined by the appraiser because the property only sat on .56 of an acre and would not give an "as-is" value (purchase price of 65k). Then underwriters said the buyers didn't qualify for FHA because the house was being purchased as a primary residence and his employer & job was more than 160 miles away (good to know this rule). After several conversations with the lender, he told us there was nothing they could do. Oh well, time to find a buyer another lender. I sent the buyers to a lender that I know, and he offered the buyers to purchase the home conventional as a second home. New Lender so new contract for purchase on Feb 5th 2016 and he pushed the loan through that we closed yesterday. Another note the appraiser for the second lender also flagged the property contingent on environmental inspection of septic tank. However the lender's underwriting waived that clause because it was not an FHA loan and the buyers were accepting the home in as is condition once the repairs were made.

@Azia MartinHere was the terms of the sale. Offer price of 69k contingent on pest inspection, replace roof, replace bad ac unit, and repair broken window panes (BB Guns Sux), and seller concession of 4140 for closing cost. We did fix all the issue as per contract, and below is the break down of expenses.

Purchase Reo 33,500 (bank listed 35k but I knew ac unit was bad)

Roof 4,500

Ac Unit 1,975

Duct work 300 (found when replacing ac unit that rats or squirrels ate the old duct)

wood work on soffit 417.

The rest of the expenses included water, electric, insurance, and garbage that I am just going to add into the total cost of expense. Also note, we have a 75k line of credit at 5.5% that was used to fund the project, so we did have to pay one month of interest of $220.

Sale Price        69K

Concession     (4.14k)

Net at closing  64.86K

Expenses      (42,983.31)

Total              21,876.69

My share is half that so I took down $10,983.35. It might not seem like a lot but I feel the work that was involved or should I say the lack of work involved made this a great deal. Please let me know what you think. I looking to learn so please send me your feedback. 

No problem @Oscar BuendiaI am happy to help. 

Oscar Buendia check your inbox.

One of my clients was able to get a portfolio line of credit with State Bank & Trust here in Ms. You can google then or email me for their contact.

Congratulations and keep up the momentum.

Tyler Alberson remember to foreclose you'll need money to buy back your property depending if you live in a title theory state or lien theory state. Last thing you want to do is foreclose and the house sells for less then what the borrower owes you.

Congrats and keep up the momentum.

It depends. To qualify for a FHA, lenders will take in consideration how far the property is from you job. If the house is more than hour and a half commute they could turn it down. In larger city's they may increase the commuter time.

If it's a local community bank you could ask the bank president what their policy is on purchasing REO. However if it's a national chain they are not going to talk to you.

One thing to consider is your down payment would hardly cover the agent's commission. It's typical to see 6% commission. Therefore 100,000 sales price would generate $6000 commission to the agent. A $5000 down payment would mean that the agent either renegotiate their fee or the owner would have to come out of pocket. Please tell us how it goes on this deal. Best of luck.