All Forum Posts by: Mike Sedlacek

Yes his yearly in pocket profit was $100,000. And that is not hard to attain over 10 years.

Here is an idea that may work. Sell the property on a land contract, no deed transfer you still have the deed. Have your attorney draw up a wrap around mortgage with monthly payments to cover your existing mortgage and plus extra for insurance and property taxes. Have the mortgage due in 5 years, a balloon payment. The buyer will have to refinance and pay off your loan. Ask the Realtor to lower thier commission to half so that you can sell the house, and give them  an exclusive listing agreement such that they are the only ones that can sell the property excluding other brokers. Ask for enough down payment to cover the commission and closing costs and a little in your pocket. This way the buyer doesn't have to go to a bank to purchase, you are the bank. Have the broker due a back round check and credit check. You should be safe with a buyer that has a FICO score above 640. You can write a clause in the land contract that the buyer must maintain the property. 

This all depends on the existing balance on your mortgage, which I don't know, if you can afford to do this in this way, and if you can get enough monthly payment that wouldn't exceed a reasonable rent, however the monthly payment will be about 20% more than rent would be. And if you can get enough down payment that won't make it difficult to find a buyer. The owner financing route should make it more salable and produce a quicker sale. 

Do you have any family that can help you do repairs? Find a handyman through a referral and negotiate with the buyer on needed repairs. Perhaps you can do repairs while they are living there using a portion of the monthly payments.

Put in an offer now. One can not predict what the bank will do. They make no sense sometimes. With your offer in it might be the right time for the bank and, what do you know, they accepted your offer. Other than that, they do take thier sweet old time in responding. Find a realtor that works with investors and is willing to put offers in. Call around to real estate companies and ask for a realtor that works with investors. Banks may sit on the listing for ever. Sometimes they just aren't in a hurry to sell. Watch and see if the price hasn't moved in 3 months. Sometimes as we get closer to winter they will move quickly. I purchased a REO that was on the market for 3 years. The bank just didn't care it seemed. I found it through the local Fire Marshall when I was driving for dollars. I noticed a vacant house with the doors boarded up with notices from the fire department. I went to the fire Marshall and found out what bank owned it and what agent was marketing the property. The Marshall needed to know because of fire threat and break ins.

Some local investors tell me no less than 8% vacancy factor and cap ex depends on current conditions of the property and what will need to be done within the next 3 years, could be 10% of gross rents.

Go to open houses by realtors in or near the house you want to remodel and see what is normal condition for that type of house. You certainly don't want to over remodel because you won't get your money back. Kitchen and baths remodels return the most on your investment.

Minimum credit is 640. FHA loan need 3% down. Contact a mortgage broker is best. May be able to get you into some type of loan program. They will qualify you for a loan.

Call real estate offices and ask for a Realtor that works with investors and not afraid to make offers daily.

You can filter out by looking at the age of the mortgage, 10 years at least. That would bring down the balance and perhaps show 30% equity. I wouldn't bother with properties with less than 30% equity. Also what is the time frame from notice to auction? Do you have all your ducks in a row ready to close quickly? Have you found a title company that can close quickly? 

You may have to go to a commercial bank and ask for a blanket mortgage.

Try placing a sign, "Under New management." Also try advertising, "First month free for qualified tenant."