All Forum Posts by: John Woodrich

 Who says that the inspection has uncovered any material problems?  The buyer could have had another issue and wanted to back out.  

I sell my houses waiving all disclosures.  I do this because they are investments and I do not know as much about the house as someone who would occupy the house on a full time basis.  That just means the buyer will likely get an inspection because I am not claiming anything works.

I have had a person back out of purchasing a house after an inspection and they didn't want to give me the inspection report, said they would sell it to me.  This was 10 years ago and my realtor didn't say anything about them having to pass it over and of course I didn't buy it.

If the inspection uncovers a problem that makes the Disclosure Statement incorrect you likely have an obligation to disclose the information or correct your written disclosure statement.  Requiring someone to pass on an inspection report seems ridiculous.

You are trying to nickle and dime the purchase process. There are ways to go about this without "showing your hand" such as writing an offer with a different LLC or individually. You could write your offer, subject to inspection, and back out after paying the $500 for an inspection.

If you are looking to spend $150 on a report (that means nothing to you) it would only save you $350 over doing it legitimately and without hassle...

I purchase most of my properties without and inspection contingency - the only ones I do get an inspection on are properties where I want to highlight issues and badger further.  There is value in putting in an offer, especially on a cash only deal but I would do it the right way.  If you need an inspection to purchase the property, pay for an inspection.

Personally I have gone both routes.  Most of my loans starting out were with a local credit union, they new me and my brother when we walked in the door which felt good  We did get some special treatment (loan modifications instead of new loans being issued) but that all changed when the individuals we were working with went to corporate and we had to start over...  5 years ago I would have told you that credit unions are more flexible however I have moved more towards business loans (instead of home equity) and many credit unions do not have a business division and others are new to it and are still learning the ropes.  Business loans seem to be easier with Wells Fargo as my small loan doesn't put a lot of risk on them but that isn't saying a local credit union may not provide better service.

I still have a LOC at a credit union and $10 in the account but I am currently working on a business loan through Wells Fargo and may try to strengthen this relationship before starting over at the CU.

Start at your bank, it may be easier because you have an existing relationship with them. Less paperwork and hopefully less of a hassle. If the numbers work anyone will give you a HELOC and I would be surprised to see significant differences in rates.

@Amber Gonion do you feel these rates hold any relevance for typical BP investors who would typically purchase a 100 yr old duplex, four-plex, or 8 plex in Mpls or St. Paul?  These would typically be class D properties correct?

Thanks for sharing the information. 

In the current market I wouldn't invest with appreciation in mind especially if your long term goal is to live there.  Who knows where the market will move once all the Baby Boomers decide to retire.

Until it "pops" we wont know when we are in the bubble. Right now houses are near the previous market highs and interest rates are trending up (which drops house pricing).  Those don't bode well for projected house prices.  There is still a lot of demand in the market however in certain areas I decided it was best to cash in.  My was partially based on house prices and having followed that market for 10-12 years.  The other half of my decision was to further my investment goals and turn one property into 2.

@Jessica Grewe the "big guys" are not interested in my single family renovations.  They are on to bigger and better things with more upside than what I make on single family houses.

If you are following the "big guys" strategy, care to share the basics?  

Aaron  - from a tax perspective you likely won't be able to deduct any losses on this property.  This is based on the vacation rental rules and the thought that you may exceed the personal use.  You  may want to talk to your CPA about this if this is part of your decision.  The good is that you can write off all expenses and depreciation against rental income however if you plan to occupy it as a personal residence your expense deduction may be limited $0 income/loss.  At the same time, if your income is large you may be limited from taking losses in other ways.

@Dan Bryskin the delayed flip is pretty much what I am doing for my cheap rentals.  Couple flips I am working on now we are trying to wrap up to sell at current prices.  I am not a fan of purchasing cash flow, I want a flip potential in all of my properties regardless of how I plan to use it.