All Forum Posts by: Account Closed

Sarah, there isn't enough information in your post to adequately answer it. I don't usually refinance an owner finance deal. The closing costs are much lower. If you don't know what closing costs are, you need to watch a lot of YouTube videos. You will need a title company to do that actual closing and title search. Call different title companies in your area and see what they charge for an owner finance (that means a mortgage versus a cash deal) and a title search. Unless you have experience preparing the mortgage and deed, ask them what they charge for those as well. MAKE SURE THEY ARE WILLING TO GIVE YOU AN ELECTRONIC COPY OF THE DEED AND THE MORTGAGE. Ask this up front. It will save you money later. If they don't, consider another title company. There is no reason you cannot make these yourself for the next deal. Join your local REIA. They will be able to give you better advice.

Although I did not do this, I would suggest your local REIA. Most landlords are open to sharing their lease (at least I am) and give you some information. You may also, purchase a package from one of the gurus. I had read a book by Mike something (I think) with the title of Landlording on auto pilot (or something close to that) and it at least got me started with some forms. My lease looks nothing like the original, but I learned a lot since. Check out landlordology.com and actually read the statutes it references. You need to know them and make sure your lease incorporates them. As far as getting tenants. put out a sign. I had a custom made one from Vista Print that I use, but really a regular sign gets us a ton a activity. Since you are military, USAA has a deal wth a 3rd party for credit and eviction checks. I think it runs $12. Look into it. You won't find cheaper. As far as how to manage it, it is like everything else. Trial and error. You will make mistakes. Some costly and after figuring out you won't make them again.

I am interested in purchasing a note that has been in default for at least 12 years on a specific property.  A subsidiary of HSBC has the note.  Is this something that is possible?  They have not foreclosed on the home and I suspect it is more like 14 years in default due to their being 14 years of outstanding property taxes.  I am apt to say that if they wanted to foreclose on this home, they would have by now.  In it's current state, the home isn't worth more than 35K, probably less on a 56K face value note.  The home is in NC.  I am not new to Real Estate Investing, but I have never tried to purchase a note before.  

With the exception of the breeds insurance companies hate, yes.  Charge them $20 a month extra per pet + carpet cleaning and flea removal service when they move out.  

Note:  You shouldn't have carpet in your rentals.

LTV issue on the one that may have enough equity to cover it. The others aren't worth enough to cover it. Don't desire to get 2-3 to cover this when one is sufficient.

I have a 73 year old seller of a property in a hot are of Charlotte who is interested more in the tax implications of this deal than maximizing his profits.  His most important aspect to make sure he doesn't go into the next tax bracket.  He is willing to do some owner financing, but it has to be a little unique.  This is a buy and hold property for us and we have to dump some money into modernizing it to maximize our rental income.  This will not cash flow well (if at all really) until the terms of this deal are finalized.

Here are the numbers

Selling Price: $175k

Actual Price: $200k (this is what he was about to list it for)

ARV: $240k (this has been checked with local comps. Area is appreciating quite rapidly but doesn't factor into this deal).

Repairs: $20k (my crew)

There is instant equity on a keeper house.

Seller is willing to finance this deal over a 3 year period.  He is asking for the following.

• $10k up front
• $1k per month
• $50k per year in a lump payment
• 0% interest
• Remainder of balance in Month 37 (around $19k, I don't feel like figuring it all out for this post as of yet)

I think a HELOC is the best way to approach this. It all but guarantees the money will be available when the $50k payments are due. It also allows us to only pay interest on the money we actually need versus getting a mortgage up front and holding onto the money.

Concerns:

I want to protect his position as much as possible without putting a lean on this property that would prevent me from getting the HELOC I need.

Possible Proposal:

Assuming he requires this be secure, I can put the lean on another property or properties to protect his position. I have 3 homes I own outright and 4th that has about $160k or so equity. This would allow me to get the HELOC and make the payments to him on time.

Is this the best solution?  Is there another more appropriate solution?  Has anyone structured a deal like this before?  We are going to purchase this house, I am just looking for the best way to protect the seller and ensure I can meet my obligations when the larger payments are due.  I currently have about $35k-$40k, but we are rehabbing a house and expect to close on another deal that will require rehabbing as well so I want to minimize my up front costs as much as possible. 

Thanks for taking the time to read and respond to this.

My wife and I may make it.  Uptown isn't my favorite place.  :)

 Do you have pictures?  We are about to do 3 homes and would be interested in what the bamboo looks like.  This may just change my opinion of vinyl.

The OP mentioned laminate and not hard wood.  Even if she had, I wouldn't put hardwood flooring in.  I would put tile that looks like hardwood.  Yes, what you mentioned is easier to put down and if you paying your labor $60 dollars an hour, then it is cost effective.  However, newspaper is pretty much free, readily available no matter where you are, extremely effective and I can have own the underlayment in less than 10 minutes.  The planks were lined up on purpose (you know what the odds would be to do that accidentally?).  This particular laminate has beveled edges and looks quite stunning for the price in person.  The photo doesn't do it justice.  It is our goto choice when replacing carpet.  When they tear it up (and they always do), you can use their security deposit to "do it right" or upgrade if you are that type of person.  I like the stuff and it sells rentals.

With that kind of cash flow, why get rid of it? Get a bigger HELOC or 2nd mortgage and get something else. That kind of cash flow is unheard of in my area for the most part. I don't plan on ever getting rid of my A and B properties. They just make too much money.