All Forum Posts by: Account Closed

Hi BP community, I just wanted to get the feedback and advice from investors/realtors/lenders on this forum.  I'm currently under contract to purchase a SF house in the Riverside county area.  

I was curious - what's everyone experience right now on removing loan contingencies before the close of the sale?  Is this a normal practice? I understand that when you remove all contingencies from the contract, if we do not finalize the loan on time or the lender does not fund - then the seller can keep our Ernest money.  

Background - we were searching for months in the area and continued to get beat out by multiple all cash offers that were ~$45-55K over listing price.  Many of the houses we viewed were listed for 1-2 days before locking into contract. We saw a significant increase to listing prices since Nov '20 (not surprising as this is similar in the rest of CA).

We thought we landed on a gem b/c this property had fallen out of escrow due to last buyer's inability to close the loan.  We came in with a pre-approved loan letter, half of the Ernest money as down payment.  We had a 30 day loan contingency and an estimated 40 day close (4/19) listed in the contract. We've hit our 30days today 4/10.  The seller is pushing us to remove all contingencies.  She's not being flexible and will not sign an extension. Our lender/ escrow/title is estimating ~4/16 to close.  From everyone we've talked to, it's completely normal for things to shift by a week or so and typically a seller will extend the contingency. With her past history, she won't budge.  

The seller is the listing agent.  Seller told our agent that she continued to get all cash offers much higher than ours, after we locked into contract. She kept her listings up for a week after we locked into contract and my agent's office had to push her to tag it as under contract. Our agent thinks the seller is trying to keep the Ernest money, back out of the contract, and go with the all cash offers  :(  Shady! 

Any ideas on how to handle or mitigate risks on our end? 

Thanks in advance for your advice!

Lena

Hi there also you can check out Airdna.com. You can enter in the zip code and provide the specs of the house and they provide an estimate on the rental income. That's also another quick and easy way to identify the revenue for that zip code. They pull data from Airbnb and VRBO.  

I've been actively looking for a property in CA and asked my agent a similar question.  We've seen over 30+ homes and I was curious which bids are 'winning' because we continue to get overbid by cash buyers.   She point blank told me that no one can ever know what is under contract until the property closes and the purchase of the property is registered, finalized/closed with the city and title complete.

@Arby Gharibian

Did you ever figure out the answer to you question? I’m searching for the same.

I’m reading in CA the seller has to submit a request to perform and you have 48 hours or they can decide to cancel or can after keep your Ernest deposit. What did you find?

@Basit Siddiqi thank you for your thoughts! 

@Basit Siddiqi - I should have clarified the $50K break down:

$32K for structural repair including replacing new beams, new walls, replace all ceiling joists (to get to code), stair case, peanut curb 

$15K for finish like plumbing, electrical, dry wall, kitchen install, bathroom install, flooring, paint

That is good advice on making a trip out to Jax. Thank you for your input!

Hi BP community, I would like advice from folks who are familiar with the Jacksonville FL area or looking for just some general feedback.  

Last year, we purchased a multi-family for about $170K in the 32208 area code.  It has a 3/2 house in the front, and a stand alone garage + 2/1 apartment on top.  The front house is fully rented/rehabbed. 

The garage apartment we had intended to turn the garage area into a living space, put in a stair case and make it a 3/2 house.  We hired a terrible crooked contractor who did an awful job, didn't submit permits, and we need to fix a bunch of structure stuff now after he cut into a load bearing wall.  *I KNOW it's been a nightmare to say the least!!** 

Here are the numbers so far:

$170K purchase

$24K rehab spent to date + Engineering drawings, design etc 

$190K all in so far 

I'm getting estimates back to fix the structure plus the city wants to add a bunch of stuff brought up to code including replacing all ceiling joists etc.  

$190K Spend to Date 

+ $50K Estimated Structural, electrical, plumbing, finishes, permits etc

$240K Estimated cost all in 

I did the calculations and if we get decent rent for the back house we should be able to make 7.6% ish CoC return. Not ideal, our targets are 11-14% returns.

We have not been able to find similar comps in the area.  I found a multi near by in same zip for 6 beds, 4 baths listed for $260K.  

Quick Poll:  

A) Bite the bullet and drop another $50K to finish this out?

B) Run and Sell? The garage is in an unusable state so not sure what we would get for it. 

c) Other? And Why?

TIA for your time! 

@John Voychick did you ever find a good PM in the JAX area?  I was looking for the same and someone who can manage a rehab project and take over the property management. After your research - any recommendations on where you landed?

Hi there found this old post but we are also looking for a GC that someone on the forums would recommend for a remodel in the JAX area please message me if you have someone that is honest, does good work and has decent pricing thank you!!! 

Interested please include me. 

FYI - There is also FIBI if you look that up on meet ups.com. The group meets once a month in Manhattan Beach.