All Forum Posts by: Rachel Deering

Congrats, Bryan! Sounds like you did your homework and made a great deal happen. Best of luck with these properties!

Thank you, Jonathan. Yes, you are right that I am, indeed trying to help her at the same time that I can help myself. One of the advantages to me doing it this way is that because it will be a primary residence for her, the down payment is much lower than a straight investment property. Also, she will maintain the property and be making updates to add value while living there - painting, pulling up carpet, refinishing hardwoods, landscaping, adding tile, etc....not big expenses, but certainly lots of labor and minor expense. I was hoping that this could be a win-win for both of us. 

My 24 year old daughter and I were looking (and found) a duplex to buy in Pennsauken, NJ. Our plan was that it would be a primary residence for her with me as a co-signer and I would make the down payment and all upfront costs. She would get a great deal on the house and a lot more for her money than she would get in a rental. After she moves out, we will split any profit from renting the 2 units out. 

My question is what would be a fair way to structure this business deal? The market value of her unit is $1100 and the other is $700 per month.  The total mortgage including tax and insurance is about $1300. If she ONLY paid the balance of the mortgage payment after the other tenant's rent, it would only be $600 per month.  Of course we would need to add money to that to cover any property maintenance, vacancy in the other unit and the typical items that should be allotted for, so maybe she pays $800 or $850, with $200 or so going into account to cover those items, right? She plans to live there for no more than 2 years, at which point we can rent it out for more. 

I am investing $10,000 for down payment, initial repairs and a small emergency fund to start out with.  (When do I get that money back?) I have told her that this MUST be an investment for me because we are simply not in a position to be making a down payment on a house for my young daughter just to help her out and she, otherwise, would not even be buying a house by herself because she is not ready to take on that responsibility by herself. We need this money to start working for us, but we also want her payment to be as low as possible.

Please help with any ideas. Also, I'm in Texas. Do we need to set up an LLC in New Jersey? I need to find a tax person who can help us do this so that she can get the homestead exemption, but we can treat the other rental as a business. It seems very confusing to me and I need help! Thanks!

Hello Annis.  I have worked in the film industry also!  As has my sister.  Not a lot of work in that field (tv & movies) in Dallas, but lots of commercials.  I, too, have been searching for an investment property in the Dallas area for the last year or so. Dallas real estate has absolutely sky-rocketed over the last 10 years.  The home we bought in 2005 for $192,000 is now worth $395,000, at least!  As a single family rental, we could probably only get $2500 - $3000 if we rented it out, which will be great for us if we decide to do that because of the purchase price, but would not work at all if we were buying now.  That said, there are finds, depending what you are looking for, if you have a good agent who notifies you as soon as they hit the market, and - if you are willing to live there, you are also willing to be somewhat of an urban pioneer.  Here's the thing - Dallas's growth is not stopping! Newer rehabs and builds are now happening in areas of the city that no one would touch 10 years ago (west Dallas, just west of I-35, especially closer to downtown; the "Farmers Market" district, just south of downtown and east of the Cedars neighborhood.  Those areas have been crime-ridden in the past, have lots of run down looking places and have been very poor. But builders are moving in slowly and there are still opportunities open for those who are willing to take the risk and wait it out for a few years.  They WILL absolutely become viable neighborhoods because there is nowhere else to go in Dallas unless you move to the suburbs!  The growth is good on one hand, but it is also sad, because this growth is pushing lower-income families out of these neighborhoods and the city is trying to figure out how to address that. 

As far as duplexes or maybe four-plexes, you might see something in an area like this that would work:  https://www.trulia.com/p/tx/dallas/4707-junius-st-dallas-tx-75246--1150721864

Just saw this and you can not go wrong in this area!!!!  https://www.trulia.com/p/tx/dallas/819-n-marsalis-ave-dallas-tx-75203--1005911092 This will sell fast,  I'm sure!

If you're open to Arlington, it is growing fast, as is Ft. Worth.  East Ft. Worth has some great houses, great vibes, more laid back than Dallas and way cheaper!  Also growing!

Good luck.  Let me know if I can help by answering any questions.

I have been looking for an investment property and my 24 year old needs a place to live. She is in New Jersey and I am in Dallas. We are not in a position to just give her money and need our money to create passive income and equity. She is not ready to tackle home-owning by herself. She can qualify for the loan on her own, but we would fund the 3.5% down payment and closing costs.  We have found a duplex with a tenant who pays more than what 1/2 the mortgage would be. How can I set up a business agreement without me being on the loan (so that I can do another investment without that liability on paper) where we are both benefiting from the arrangement? BTW, she is absolutely thrilled at any arrangement that would get her so much more for her money on a monthly basis than she would get renting, which is what she would be doing if we did not help her get into the house.  We are a very tight-knit family with complete trust and respect for each other and we would put the agreement on paper. The property would continue to be a rental investment for both of us after she moves on, probably in a couple of years.  Thanks so much for any input.

I'm looking for a real estate agent to help me find a duplex in the Camden County area. I would really like to find someone who speaks Texan - friendly, polite & accommodating! Someone who has patience with an out-of-stater and who can guide me in the right direction, explain the differences in purchasing property there, but who can understand and appreciate the thoroughness of my own research and be willing to POLITELY explain why they don't want to show me properties that I have tagged. My budget is low - less than $150,000 so maybe that's why the person that I was working with couldn't bother to return my calls or emails promptly (within 24 hours).

Also, Charles, the trustee is listed there on the MLS. My understanding is that when they are in pre-foreclosure you can get financing without having to pay all cash if it goes to auction. If you are correct, then I am clearly missing something somewhere. Any suggestions on how to learn more about this from an accurate source?

Charles - What??!! Big fine and jail time to try to buy a property in pre-foreclosure that is listed on MLS? They want to sell it. I don't understand what you mean. The listing itself says to contact a "Foreclosure Specialist" to inquire about the property.

I’m interested in purchasing a property in pre-foreclosure. I don’t have enough funds to purchase anything with all cash - it would have to be a loan. Need recommendations for realtor who specializes in foreclosures.

@Matt Ott @Mike Dymski  Thanks for the feedback. One other thing I have to consider is the comfort level of my husband who is too busy working all the time to be able to spend time on this. He shares the same goal and enthusiasm for investing, but is ten years older than me and is our sole provider right now. There is no income if he doesn’t work, and he worries about me being saddled with that debt should something happen to him. For the record, I am 55, he is 65, and I hate words like “empty-nester”, “retirement”, “downsizing”. Ugh!  We are finally to the point where we can start providing for our own dreams and goals instead of those of our young adult children! But we’ve got some catching up to do financially. Thanks again for all the advice!