All Forum Posts by: Mark Bookhagen

You are right below the "70% ARV guideline," which is good:

Target price = (85 * 70%) - 14 (for repairs) = 45.5 > 44

Side note: 6.5% is pretty high for a 30 year, let along a 15 year...

He is only putting 50% of the capital needed (without working), and you are putting up 50% + the "work." Personally, I think the work is worth 50% and the 100% of the money is worth 50%. So from what you've told us, you are putting 50% of the capital, which gives you 25% of the profits; he gets 25% of the profits for 50% of the cash, and then you get 50% of the profits for doing all the work. So you would get 75% of all profits, and he would get 25%. That's what I'd be looking for if I were in your shoes. You may not get it, but that's what I'd want.

If the property is in bad shape, you will have a harder time getting a mortgage on it in the first place; it may not pass the bank's inspection or you'll have to put a huge percentage down. You may want to look into a small business (personally guaranteed) loan.

Sounds like a scam to me... careful...

Awesome idea... I love it!

Texting is great. It is especially great when you need to pick up cash or checks. I don't see it as unprofessional at all. You simply need to write full sentences, and do not use slang/abbreviations. If you do, that IS unprofessional.

The text string usually goes like this:

Me: Hi John. What time works for you today?

John (tenant): 10:00 should be good

Me: Okay. I will stop by then. Thanks.

Done...

HELOC will save you thousands over a refi unless your rate will be much lower (2-4% lower) after the refi. HELOCs are often "free" to get and you only use what you need when you need it. That way you aren't paying interest on money that you haven't put to use yet.

 Hi Derrick,

I buy...

If you are both applying, the bank will use the LOWEST credit score of you and your partner. So from the sounds of it, your score won't matter much. They will also (as your broker told you) consider ONLY his income. The icing on the cake is that they will include YOUR debts PLUS his debts when calculating the Debt to Equity ratio of the applicants. In essence, your involvement in the application will be hurting the deal a lot (your good credit doesn't help, your debts count against the DTE ratio, and your income doesn't count). I feel for you! I would look into private money until you have established your 2 year requisite income that banks like from SE applicants. Don't give up though!! People have done it with a lot less...