All Forum Posts by: Robert Littke

Its getting harder and harder to tell good tenants by foreclosure and bankruptcy history. You have to dig a little deeper than a credit score. There are other indicators if you know what questions to ask and what to look for. I personally like short answers to tough questions, with eye contact. that tells me a lot.

Thanks for the advice The risk factor is fairly low, solid buyer, except for a year old short sale, steady income and payment history over the last 8 years, would be an OO. The seller is older (85) non-investor, just looking to sell and open to options. Lender says new loan would be about 30 months out. The ($57,400 above was rounded down from the $62,260 below to account for additional costs)
I will Skip the vagueness:
She can sell it sometime over the next year for maybe, on the high end: $320,000 - Payout $17,600 in commissions and other closing costs and for an approx payout of: $300,000

OR
(Calculated on a 36 month Lease option)
$1500/mo. lease payment and additional $200.00 a month in down payment money and $35.00 a month in "option money".
$5,000 - Down (non refundable)
$54,000 in lease payments
$7,200 in Down Payment money
$1,260 In Option Money
For a total of: $67,460

At the end of which time a bank loan is acquired and a payout of: $294,800 - No commissions to brokers, for a total payout to her of $362,260

**If they fail to purchase at that time she ends up with $67,460 in her pocket and her house back to sell.

Again, seller is 85 year old home owner just trying to maximise her way out of the home.

Can someone correct me if I'm wrong here:
If I have a property I paid $35,000 for in 1979 and I can sell it today and walk away after closing costs for $300,000
OR I can finance it for 3 years and walk away with $359,400 after payouts. (lets forget taxes for now)
How would you calculate and compare ROI? If I could have $300,000 today, should that number be a part of my initial investment in the 36 month finance calculation? In essence, am I "reinvesting" the $300,000? I hope I'm making sense.

Here's a question, how long can you draw out an option to purchase? Years? can you put annual options in? With more earnest monies along the way?

Thanks guys, lots to think about. Jon, "B's" familly is now concerned about what they would do with house #1 if "B" went into a nursing home or passed away. They say its also complicated by fact that house #2 is in a trust.

I'm finding the best strategy for REAL rates is to call signs and "walk and talk." Just last week I walked through an entire building and asked tenants questions. Surprisingly the owner of the building was the one who gave me the most answers! She spent 40 minutes with me showing me around and telling me all about her tenants, recent upfits, and showing me vacancies. She also told me all about other buildings in the area.
When it comes to upfit these days Jon, your right, the market is expecting a lot. Although each deal is unique, I've been starting to demand a personal guarantees tied to costs that go above and beyond "value adders"

Thanks Jon, Thats allong the lines I was thinkging. About my only concern was taxes, insurance and upkeep.
The taxes are almost even, only a couple hundred off, but the difference in insurance for the two states is significant to the tune of $1800 a year. Would you suggest any particular way to make sure the one side is getting the taxes and insurance paid?
The other owner does own free and clear but I think she is about 85 and doesn't want a mortgage (which I can totally understand)

Dig, Analyze, Ask Questions, Listen Carefully, Repeat again and again and again..

Ok, I'm going at re post this because it disappeared and in the BiggerPockets abyss. So here goes the lengthy explanation (Again).
I have a client with a $230,000 mortgage on a $260,00 home and a 6 month old bankruptcy, credit score of 670. She wants to move to and has someone interested in her home who has a $300,000 home they own outright. My client is interested in taking over the buyers home but has been told by a lender she probably wont qualify for a loan for at least 36 months. What are her options, that would best protect buyer and seller. Pro's/Cons. (The homes are in different states)

I have an excel calculator that may interest you. Not sure how I can post it here.