All Forum Posts by: Nathan Grabau

If you go with the third option, I would consult a lawyer in your area. If someone can rack up 19k in back taxes without being foreclosed on by the state, I would worry broadly about the eviction laws. You consult with a lawyer, figure out what your holding costs and legal costs will be to remove the squatter, add some breathing room, then add a margin that you think is reasonable (another 5-10% here is not unreasonable and you could go higher than this) and make an offer. 

I would vet this aggressively with a lawyer because he having some for of squatters rights would not be crazy given her advanced age and the surrounding circumstances. I would google "adverse possession". 

When you turn what every buy sees as risk premium into due diligence premium, this is where you can make a ton of money. 

What you are looking for is the seasoning period on your loan. I have been able to refi convention loans 121 days after a refinance. 

What you can do is get a hard money loan or some type of bridge financing and that is designed to be short term. A lot of the time, between the risk you are taking(you have to refi a bridge loan as it is short term), the higher rate you are paying, and the origination costs, make this not incredibly ideal for funding vs a conventional loan that you cash out refi after 4-6 months. 

You can also go to a private local bank or credit union. They can likely give you similar terms to a hard money lender and let you do a construction loan that is based on your after repair value, that then ams on a normal schedule. Developing relationships with local banks might be one of the most underrated things that you can do to help efficiently scale your portfolio. 

What issues are you dealing with with your mortgage servicer? Its generally considered impossible to change mortgage servicers. That being said, if it is an issue with an escrow account (things like insurance being paid in a timely manner) you can request that you pay your escrowed costs directly with an escrow waiver. 

Would be curious about what issues you are specifically dealing with. Servicing a mortgage is relatively straightforward, and does not have much leniency, so if you are asking them to be creative and they are refusing to be, that is not necessarily them being bad. Mortgage servicers, even if its the company who gave you the loan, tend to just manage the collection of payments for investors who own the loan through something called mortgage backed securities so they have to operate within a very strict set of rules, that they do not have control over.   

There are two things going on here that I can see. The first is cosmetically it is not in phenomenal shape. We are seeing houses that are not the nicest sit on the market longer because buyers are looking for things in better cosmetic shape. 

Second is price. If a house isn't under contract quickly, its most likely the price. The market is slow, but there is very little inventory. While the zestimate is not the best source of data, this is still listed at above its feb/ march 22 zestimate, which is likely too high, especially given its condition. 

You need to drive around your neighborhood and see what other people are doing. This will give you a good idea of whether buyers in the area expect a garage. If people expect a garage and they are not going to get one at your house, you will shrink you buyer pool.

In most areas, this is not a huge value add(for resale at least). That being said, in some fast growing/ high population density areas, the value is very high. 

(response written from my office which is ironically a garage conversion)

This might seem silly, but I would drive around looking for dumpsters and people working on Saturdays. You would be surprised by how many people you find who are highly motivated. You want to make sure that you vet their work and insurance and things like that, but this is a great way to meet new talent. 

startvirtual.com is Pace Morby's site and I was impressed with them when they presented to me. I think a VA is probably a cheaper solution and easier to scale to other areas than a channel partner.

Some local institutions who carry their own paper should be able to base the income of a property of a reasonable proforma based on current or appraised rents. I was able to funds all 3 of my MF properties(20% down, prime -0.50, DSCR 1.25, 7 year balloon on a 25am) off of pro forma financials.

I would assume that you are going to have to go into multiple local banks to find one you connect with, but you should be able to find one. Secondary markets are on very unstable footing, so it is much harder to get money now, but banks still have to lend to make money, and really do need to dilute the low yield paper they currently are sitting on. 

I do not think there is a way around FHA requirements. These are legal requirements and a bank could be severely fined or lose the ability to write FHA loans if they do not follow it.

Do you know how close to the requirement you are? If you are close, you could put more cash down, lets say 5-7%, which would reduce your mortgage. 

You could also to offer to pay for points, which would reduce your interest rate and reduce your mortgage cost. Last time I checked, every "point" you pay reduces your mortgage by about 3/8th of a percent. So paying 9600 in points would reduce your mortgage by about $250 a month. While not ideal, if you really want the would paying 2 points to take about $500 a month off your mortgage let you pass the test? This is an additional 19k as opposed to having to put 200k down. 

I am not a lawyer and this is not legal advice, but I have added a cancellation clause "cancelations within 24 hours of arrival will result in no refund, cancelations 1-3 days before check in for a 50% refund" as well as a fee associated with undisclosed pets, that is around twice the fee for disclosed pets that you charge.