All Forum Posts by: Mariusz Bojarczuk

Originally posted by @Mariusz Bojarczuk:

I am buying a house for 62000. The closing costs presented to me are about 6000 dollars.

I was told that points are money as insurance for the bank that I will not sell property early, so they can keep getting mortgage for 30 years. Has anyone heard of that?

The processing fee is 1900. That is a high number. 

The bank wants me to pay the full downpayment although I already made earnest money deposit.

Could anyone help me? Why are the closing costs so high? The house is in Memphis. It seems like every charge is inflated. The bank gave me what they call “preliminary” closing disclosure which legally does not exist. I explained to the bank I signed this meaningless document for their convenience, so underwriter can get a bonus for higher numbers of closings. I was told the closing costs are basically set now.

Can anyone help? Aren’t closing costs supposed to be between 2 and 5 %

Mariusz

Mariusz

It all depends on the type of financing you're getting.

Yes, $1900 is high for an owner occupied residential property, but it's not high for a non-owner, no income verification loan.

Points are not "money as insurance for the bank that I will not sell property early". That would be a prepayment penalty. Points are either for origination or discount (to buy down the rate).

Sounds like the bank was trying to get you a closing disclosure quickly to satisfy a TRID requirement. A "preliminary" closing disclosure would provide a date in their system.

They will not require you to pay the full down payment if you've already paid an earnest money deposit.  It could be that they didn't have the contract to back the deposit out of the down payment or someone just forgot to subtract it when they were doing the data entry.  It happens.

Your statement "I explained to the bank I signed this meaningless document for their convenience, so underwriter can get a bonus for higher numbers of closings." is ridiculous.  Underwriters have nothing to do with closings and get no bonus if a loan closes or just sits there.

My suggestion is walk away from this bank that frustrates you (and believe me, you frustrate them too).  Find a mortgage broker that you trust.  Talk to them and let them educate you about the process of getting a loan.  You'll feel better, have less stress and close easier.  

Stephanie

I was very upset when I saw closing above 9% of the purchase price. I wrote to the bank and flatly refused to pay that unless I get a full breakdown of all charges. I also refused to pay points. I never heard nor found any explanation that this is bank’s insurance I will not sell property. They wan1.75% for points. I don’t need points.
thank you,
Mariusz
Originally posted by @Tom S.:

@Mariusz Bojarczuk Very high in my opinion. I closed on a $50k house here in VT and pulled up my HUD, and here's what I have:

- credit reporting fee $15

- flood zone determination fee: $25

- Documentation fee: $350

- Attorney fee (incl title search): $1,000

- recording fee: $150

- wire transfer fee: $40.

This does not include insurance prepayments, utility deposits, or items like that.  Maybe $500 for those. Hope that helps,

- Tom

You are right. Honesty is rare. I like what you said about cash buyers and independent appraisals. That makes perfect sense.
When I bought my house, the appraisal came out exactly the same as the price agreed upon. It made the transaction go smooth and with no problems.

Originally posted by @Curt Davis:

Originally posted by @Account Closed:

@Jay Hinrichs   To me it seems like @Curt Davis's logo should be changed from a red house getting blown over to giant red flags blowing in the wind.

Cant handle a little honesty?  Its actually a rare thing to find among turnkey providers or anyone who sells houses.  

I was not aware that the house you mentioned is not in Memphis.
I understand you do not want to name the area or company. They may be suitable for many investors or some kind of mistake happened in their calculations.

Thank you for your information about the houses in Memphis. I aim at 60,000 to 70,000 to buy a property there. I am constantly told I must raise my price range because it is too low. Since it is my first investment, I would prefer to buy at a lower price. Thank you again for letting me know you are happy with your investments in Memphis. 
Mariusz
Originally posted by @Daniel Mills:

@Mariusz Bojarczuk, the house is not in Memphis. I would prefer not to call out the turn key company because they have treated me well, so I don’t want to name the location but it’s in a rapidly appreciating area.

I do own 4 other houses in Memphis though. They cost between $55,000-$70,000 each and cash flow really well. 

I agree with you Derrick, everyone needs a place to live. And every property will be different with different risks and benefits. Some new investors will look for the safest investment but I am sure a seasoned ones will not shy away from neghborhood you would classify as C or D. There is always a match. 

Mariusz


Originally posted by @Derrick Craig:

Hi @Jack B.

Thank you for posting the forum question about my company. Also thank you @Melodee Lucido  for explaining who I am and your professional experience in dealing with me and my company... 

@Dean Letfus and @Curt Davis   thank you for stating some of your personal opinions concerning homes that are priced @$50k or less and some homes that are priced at more than say $70k etc. You both have great companies and wish nothing but the best for each of you and your companies.

Now back to the original post concerning my company.

Here are 2 links to my bio

http://www.linkedin.com/pub/derrick-craig/62/a41/6...

http://www.memphisbuyandhold.com/team

The properties I purchase rehab/repair are SFR, Duplexes, and Multi Family apartments that I grew up around. I am a product of the inner city of Memphis as you can read from my bio I was born and raised here in Memphis, many others are not from this city and or don't live here. That is not to say they don't know Memphis and REI!!!

We all have different areas of the city that we invest, I choose to invest in areas where I grew up, attended grade school and attended College.. Le Moyne Owen College GooOO Magicians LOL!! I also still have friends and family that live in the areas I invest. This cuts my risk on investment down considerably compared to other companies. Which raises my CoC return to the numbers you see on my website. Some of my investment properties may be in areas that many feel are bad areas, War Zones, or C or D Class properties which is great for me and my investors because I am able to continue to scoop them up for pennies on the dollar. The people that rent/buy/live in these neighborhoods need a nice place to stay and raise their families as well, it's called giving back to the community that raised me....And also making profitable investment at the same time. I invite anyone to come visit Memphis and view any of my available properties/Leases/Sec 8 HAP Contracts, I will even treat you to some of the World's Best Bar B Q.

 @jack If I was able to get 22% appreciation in my local market along with great Cash flow I would invest there as well.

Thank You for posting this forum Hopefully I was able to answer all of your questions about me and my company if not please PM me or call or email me  from my info below.

Originally posted by @Michael P.:

261,000?  Is it a package of 2-3 turnkeys?

Yes, I checked Zillow estimates. I know they may be off to some degree. And yes. This company is advertising fully rehabbed houses already rented. I did ask if I can come and visit but that was not answered. I constantly see the question if I am now ready to proceed. The houses that were shown to me "are already sold" I was told. 
Mariusz

Originally posted by @Jeremy Z.:

Originally posted by @Mariusz Bojarczuk:

Hello everyone,

The update is. I received the exact loan terms. It seems this loan is what most of you warned me about.

"It's pretty straight forward, 30% down, 10yr am, 8.99-9.99% interest rate (I would have to check with the lender on what they can do, but no higher than 9.99%). Principal payments built into the loan. This one will be around $100/month cash flow is all, but will be free & clear in 10yrs. This is a good loan option for people that don't necessary need the immediate cash flow, but would like to own homes free&clear in a short period of time." 

I am asked if I want to proceed. But I do not even know the price of property or what property it is.

I did ask if I can buy fully rehabbed property with a tenant already in place. No answer to that although I see the ads on Marketplace advertising such properties by the company. Why am I only offered the deal where I buy unfinished property?

There are some investors who wrote positive reviews of the company. Am I getting paranoid or something really is not right?

Mariusz

 In your original post you stated that other properties on the same street go for $10K-15K less than this one. Why are you feeling the pressure to proceed as though you are missing out on an opportunity? Sounds like this may not even be a good deal, unless they are offering superior finishes (in which case, they could be over-improving for the area).

Have you visited this area yet? Are there similar properties on the market that are already rehabbed? Do the numbers work on those?  If it were me, I would take a long weekend and go explore the area and properties in person. Well worth the money, in my opinion.