All Forum Posts by: Matthew Shay

I am trying to understand something about the background history of a Manhattan building that was purchased 6 years ago by a developer in order to turn it into luxury rentals. Here is the current info: It was purchased for $60MM cash with a 30MM loan. Now the same lender issued a 70MM loan to replace the original one. It was transferred via Bargain & Sale Deed without covenants against grantor's acts. This means that the downpayment of the borrower/developer needs to go towards improvements first. Why, is it in the interest of the grantor/seller to put this in the agreement? 

This mortgages on this property were being sold like crazy before the banks collapsed. The previous owner took out a new mortgage  (300k) with the last bank that was assigned a mortgage prior to the sale. Then they signed a $10MM deal to consolidate the mortgages. How does it work when the previous owner agreed to consolidate all that debt? I do not see any records that it was paid off. 2 years later the property is bought for $90MM. What do you think would have motivated the seller to dispose of the property, to pay off the debt? The multifamily would have matured 3 years later so they would still have time. My initial thoughts is that they may have been in default but there is no lis pendens. It may have just been the right opportunity for the seller, he did get $90MM after all

I want to share this deal with the BP community. This was a vacant lot that was advertised online with a no reserve auction for $101. The market value I found on it was in the mid $50,000 range. It was being sold subject to all liens, taxes, ect. I managed to win the auction, for some reason there was no competition. But previously I noticed that someone bid upwards of $30,000 for this but for some reason the deal did not go through. After sending my $101 deposit the auction site told me the seller refused to sell this. After reading about auction laws, specifically, absolute auctions I was armed with the right info in order to demand from the seller to sell me the property. After speaking with the seller's attorney we negotiated a deal and they agreed to sell it to me. Without delay I had this listed with an agent  and we got multiple offers. Within 3 weeks we had a full price offer of $75,000 which was accepted. With about $2,000 tax liens, $4,500 agent fees and some other fees this was bought and sold in about 60 days. There were definitely some risks involved like. I did not survey the property. There could have been problems building. There may have been serious issues with the liens/ownership because I bought it via Quitclaim Deed. I did due diligence through unconventional methods and for the amount of money I was willing to take the risk. The end buyer was able to get marketable title on their purchase. The agent did a tremendous job selling it and getting offers. We probably could of gotten higher offers if we listed it for more but I was eager to sell it right away. Grand Slam

I am looking at a SFH that has lis pendens but the owner filed for bankruptcy and is doing jail time. The property in Manhattan was transferred from the owner to the irrevocable trust on behalf of the owner. There is a 3.6MM mortgage lien which was transferred to a credit union. The tustee filed a UCC-3 termination. Is that b/c the owner filed for bankruptcy so they are removing/delaying the debt to be paid untill further notice (usually 3 months unless they work out a payment plan according to my research) I did not see anywhere that the debt has been paid so I am assuming it still exists. At what point does this property become available? Do we have to wait for the owner to get out of jail? Can we approach the trustee and how would you go about approaching them?

Looking for value add properties. Could be something that has low occupancy and has been neglected. Some buildings that are rent stabilized have the potential to be bought and you offer the tenants cash for keys and then rehabilitate and drive up market rent. Open to different scenarios. I am interested in hearing more from the community about their experiences investing in Manhattan. How did you find the deal? What type of deal was it?

Tax liens can not be bought by individual investors. You can buy a tax lien foreclosure @Dirk S.

So I am writing this post because I wanted to share my initial experiences learning about the Manhattan real estate investing market so far and advise with the BP community on Manhattan real estate investing. By the way I did work as a real estate agent in Manhattan 4 years ago. I am seeking a way to find deals and gain equity by managing the deal from beginning to end. I started with Property Shark (I believe you MUST have a tool to find deals in NYC and Zillow, Streeteasy is not enough.) Here are the tools I recommend using in NYC if you don't have the budget for Co Star ( the Monopoly of commercial real estate data platforms:) 1) Property Shark ($79.99/month or double this if you need owners information.) PS claims that they have a team of 20 persons whose sole job is to check owners info and verify it by phone. 2) Acris, here you will get the mortgage and deed information and all you need is the block and lot. If you want tax lien information or any other liens or judgements you need to go to the county clerks office in Borough Hall and search on their computers. 3) Streeteasy is a free source for sales data and pics of properties. Feel free to chime in if you have any other recommendations for data resources. Btw if you want mortgage or foreclosure information you can walk about 6 minutes from the courthouse on John Street at the city Registrar for that info. But if you own a laptop computer you will probably use acris. I began searching for foreclosures on PS. There were 3 scheduled auctions and 2 got cancelled since the lien was paid off and the other filed bankruptcy and the creditor (Chase Bank) has extended the lien for another 2 years. The only auction that happened was a tax lien for a rooftop storage unit on the LES which the plaintiff's representative bid up for $1,000. The upset price was only $23k. Now they are going to list as an REO. My initial thoughts are to look at foreclosure auctions (either mortgage, tax lien or estate) but many get cancelled. Buying Tax liens is out. I probably will have to search the data on PS and figure something out. Pre-foreclosures can be possible if I contact the owner who is delinquent. I also thought that I will have to develop a relationship with an agent who will send me deals (I know that the best deals go by fast as the top agent sharks feed the best deals first to their top clients who have bought Manhattan property and probably have portfolios) The question I have now is what is the right strategy to approach the Manhattan market scene. I know some investors who do Manhattan but I am looking for deals. What would you add or take away from these thoughts?

Side question about Tax Liens: I get that when someone is delinquent on tax liens that the city will eventually sell the tax lien certificate to one of the 3 big corporations (third party tax lien purchasers) who will buy it, receive a surcharge on the lien amount plus 18% interest compounded daily. After a certain period, usually 3 years, if the owner is still delinquent the property will go into tax lien foreclosure and auctioned off as in this case. However, my question is what happens to the big corp who purchased this tax lien which was one of many that were bought in bulk in the annual May tax lien sale if it will be listed and sold as an REO on the open Market once they clear the title. As I understand the bank just acts as a collateral agent or a custodian the guy bidding at the auction is bidding on behalf of the plaintiff.

Did you ever figure out the answer to this? @Tal Eisenberg

Hey, what did you end up going with @James W Carlucci

Newbie here with a few questions: 1) Wondering if its possible for the same REO property to be listed on multiple auction sites at the same time or would not be illegal? 2 ) What determines which sellers (i.e. US bank) work with one auction site over another? 3) Is there a way to distinguish or classify which type of REO properties tend to be listed on the many different auction sites? For example, some auction sites may tend to work with certain states or some auction sites tend to have a lot of Chinese Drywall or mold. Just trying to get a feel about the different auction sites

Can someone comment what is still accurate from the list in 2017? Is it easier or more difficult to buy REO properties?

Any news? @Megan M.