All Forum Posts by: Marty Happle

Do Hard Money I hear is ok but they have a max limit of like $250,000 I think.  You may want to double check.  There are a lot of hard money lenders out there now that have popped up on the scene the last year or so.  I am assuming you have not completed any flips yet, is this accurate?  If so you will have a little bit of a tougher time unless you have a dynamite deal that has a lot of room in it to protect everyone involved.  Private is money is relationship driven and not as easy to find as hard money.  Local REAs are the way to go for that and just letting people know what you do.  Some people are private lenders and they don't know it yet.  I would recommend asking all your family and friends for an investment and paying them at closing.  Tell them that an investor is going to make that money so they might as well make it.  If you give them 10-12% annual payable at closing you are destroying any first time hard money deal.  Upfront points and monthly payments are tough to swallow sometimes.  Just make a vow to yourself that everyone gets paid before you do and eventually people will be calling you to invest.  

Great question and good detective work.  

It is possible the seller of the note does not know.  It's possible the attorney has been trying to find who owns the 2nd.  A 2nd must be notified in a short sale so something doesn't seem right.  I bought a second and was contacted like right away by the attorney saying they were looking for the owner of the note for some time to negotiate a short sale price.  They couldn't locate the owner until I had it.

Hello,

Does anyone have a sample house flipping portfolio/resume they can share?  What's the best way to show a new lender what you have done in the past?

Do you need to show HUD's, LLC formation docs, and a P/L statement?

Thanks

Not every state is a super lien state, that may have been stated already .. no pun intended

If you own the lien you may be able to file a judgement, which in the case of a foreclosure does not get wiped and which can result in a garnishment of wages or tax returns.

If the mortgage on title is on their A game they can assess any rents that are being collected and take what is being collected.  It's a provision in mortgage docs.  

@Nghi Le - what did you end up doing?

I'm currently using an individual LLC for each flip and looking to see if something is better. It's looking like I may be getting a bunch of deals monthly so I need to see what is best for me.

Using an LLC with a partner makes the tax return harder, so I don't put my wife on anything at the moment.

This is going to be a sale though right?  Not a lease option deal?  

You enforce a DIL by having it signed before you close like a hard money deal. Or the buyer uses an LLC to buy the property (which is usually the case) and the seller can just take control of the LLC in the event of a default.

What is the interest rate on the seller financed portion ($90K)?  Is it payments or balloon?

If he has to do this to get rid of the property, the price is too high obviously.  

Jersey City could continue to grow though and it could be one giant Hoboken someday.  Real Estate speculation at it's best here.  :)

I started buying notes & flipping houses (which is turning into some buy and hold too) with OPM and partners and it is a viable way in.  I got a late start because I answered the call to go into ministry which if you want to make money and build a future that obviously is not the way to go.  Now I can use real estate to provide for my family, develop passive income, retire and leave an inheritance while all the while still help in the ministry.   I am someone that people know comes through on his word and can be counted on so people come to me with deals that work and they don't end up being the equivalent to a 7-11 job.  I didn't have parents that were able to help me at all, and when I got married my father in law had a few bucks to invest so I put it to work for him. He is happy and I'm in business.

Going back to contacting the borrower, if they have a decent attorney, then it is even better because either you or your attorney can contact their attorney and get a head start on a work out.  Some attorneys don't care about setting up their client after BK, but some steer them in the right direction to take advantage of the clean slate and use the excess cash to start making payments.   I forget the exact number, but I believe like 80% of chapter 13 plans fail and then you can go right back at them once they are dropped out of the program.  This is because a lot of people file 13 just to buy time and they never really even plan to restructure.  It keeps the creditors at bay for a few months.  They file the 13 then don't even show up to court.

My brother has about 50 buildings and in his 30 years of landlording he has seen a lot.  He had a car detail shop next door tap into his water line with help from his super.  The super got canned and the line removed.  I'm not sure how close the neighbors are, but someone could tap in.

Use a servicer.  It isn't worth the risk.  There are attorneys out there working with borrowers to find a loop hole in a lender's practices to file suit.   Also it's so cheap and easy, it is a good business decision.   There are some sellers out there now that won't sell you a pool of notes unless it is going right to a servicer.  I believe this trend will carry through to avoid federal scrutiny on all ends.

When you say a good deal, how many cents did you pay for the note?  (if you don't mind)