All Forum Posts by: Logan Hassinger

@Sean Mcintire

There are reasons for a note to trade at par. What are the details regarding this one in particular?

@Justin Polston

I have one in South Bend and Anderson. 

But we all pay cash for notes lol. 

As Chris mentioned, there are many legal ways to reduce your ordinary income. That is why a CPA is a great asset to your team. 

@Travis Smith-Armwood

I agree with Derek, additionally a HELOC from a traditional bank is based on the value of the home. A HELOC is typically limited to 80% of the value.

So in this scenario, the property is worth 50k and the max debt to be Collateralized by the home is 40k and you will already have a 40k note from the seller that should be in 1st position. Like Derek said, you shouldn’t have the deed to either. 

Unfortunately this structure, while creative, won’t help you achieve you and the sellers goals. 

@Jaysen Medhurst @Steve Puglisi

While traditional financing is preferred in regards to loan terms that are more beneficial to the borrower, however don’t underestimate the advantages it has long term. 

Advantages

• Typically unreported on the borrowers credit profile
• Flexible loan terms
• Possibility of a wrap down the road
• Able to acquire more the 10 property limit imposed by traditional underwriting guidelines 
• Less stringent underwriting from the lender

@Tito Burgos

Let’s chat offline. 

@Phil Shearcroft

Your describing a Contract for Deed and you won't be able to tap in to the equity like you think. CFD's act just like a traditional Mortgage/DOT and you are simply the lender here.

Unfortunately getting a loan for equity isn’t an option here. 

@Blake Edwards

What I’m about to say has probably already been said more than once but I’m not reading this whole thread lol. 

I think that contributing to a 401k with your employer makes sense after you’ve accumulated a fair amount of assets (Real Estate for me) first, paired with a sizable cash balance in your personal savings account (100k for me). 

My thought process is that I can generate far better returns on my own, than a typical index fund and when using leverage (80% financing on rentals), I can create real growth in my net worth. 

Then as I converted equity in to cash by selling some properties and having an above average w-2 income, I can offset my ordinary income with 401k contributions that will reduce my AGI. While maxing our my 401k in the first 3-4 months of a year, I’m able to supplement the w-2 income with rental’s/note business.  So now I’m able to contribute and not struggle for income while maxing it out.  I’m now incorporated an HSA to further accelerate tax savings and investment increase my available retirement assets that I can then funnel into RE once I’m no longer at the W2. I should then be able to greatly accelerate these balances due to my note business while maintaining The option to not contribute to these vehicles if I’m cash strapped. 

This is ONE of many ways of doing it and why I did what I did. Hope it helps. 

@San Eng

Mortgage/Note funds are going to pay very similar returns but with a longer lockup (at least 1 year but most likely 2+). 

There are a few note investors on BP including myself that put funds together for the purpose of buying distressed and performing notes in 1st position.