All Forum Posts by: Raquel D.

Hi Jose, If John transfers a property to James via a quitclaim deed, it means that John is saying any and all right I may have to this property is being transferred to James. In contrast, if John signed a grant deed, it means that John is saying I absolutely have a right to this property, which is now being transferred to James. Now, that doesn't mean that John doesn't have rights to the property, or isn't sure if he's the owner -- it's just he isn't comfortable giving the assurance to title. And why this matters is title insurance. A lot of times when people have properties and aren't sure about their title insurance (happens a lot when people inherit a property), then they will just use a quitclaim deed. It doesn't mean they don't have title to the property -- they just don't want the liability of giving that assurance. I am pretty sure that to get a mortgage on the property, you will probably need to get title insurance -- you might want to check with the title company and see what needs to be done to get it. (If you're getting a regular mortgage to buy the place, I imagine you need to use the title company anyways? I'm not really sure about that one, but the title company is who issues title insurance.) Here's a good article about what title insurance is and why you may want it -- the stuff on Clark Howard's website tends to be pretty easy to digest :) http://clark.com/insurance/buy-owners-title-insurance-necessary-when-refinanc/

I could understand some student loan or even medical that--that can really trash your credit score even if you're otherwise responsible. But the rent defaults and the Kohl's credit card are the biggest red flags to me. I agree with all the other comments about, if she defaulted on rent before, then there is no reason to believe things would be any different now--especially because of how recently it happened. And charges on a Kohl's credit card couldn't possibly be essentials--like someone who had to charge groceries/utilities on their credit card during a slump, but couldn't pay it back. Department store shopping is never necessary. Also I would definitely defer to the experienced investors on this forum, but my understanding of application fees is that they're usually nonrefundable -- like those are fees for you to pull the necessary reports. I've heard property managers/landlords mention that they specifically specify the application fee is nonrefundable, so if you haven't been doing that, maybe it would be good to do going forward? Good luck finding a tenant!

Usually when someone buys a timeshare and then wants to get rid of it, they can't even pay someone to take it from them. And if they leave the timeshare to a beneficiary when they die, the beneficiary usually wants to disclaim it -- no one wants to touch these things.

Just ordered it!!

Life insurance is NOT an asset or an investment. It's protection so if your death will leave someone struggling (children, surviving spouse, etc) and that's all it is. Good reasons to get insurance: --You have minor kids. --Your spouse/kids will suffer a major financial catastrophe if you die because of the loss of your income. --You're extremely wealthy but don't have much liquidity in your estate so if you died right now, your estate would need a big chunk of cash to pay estate taxes Bad reasons to get insurance: --Someone told you it's a good investment --Someone told you it's a wealth strategy By the way -- if an advisor is trying to sell you insurance, ask them if they're a fiduciary. If they're not, it means they can recommend products that aren't really in your best interest (and often products that gain them a commission of you buy them.)

This house is absolutely beautiful. You transformed it wonderfully and I am really grateful for you sharing this success story! Not to mention all the great comments and feedback from the BP community. This whole thread is fabulous. Thanks for sharing such an inspiring venture!

Mortgage-wise, with a loan at 4.75% and those insurance/property taxes (which would wind up being about a 2.15% rate), the payments would only be $1,797.50, which sounds like nice cash flow...

...But you're not even meeting the 1% rule with this.  If you pay $350,000 for a rental, you should shoot for at least 1% of that as the monthly rent, or $3,500.  (And many people actually go for a 2% rule, not just 1%.)

Originally posted by @Bill Henley:

@Ariel Smith: In October 2015 we got a HELOC and my wife has used this source of funding to buy seven properties/21 units in her home town of St. Louis, Mo. The plan from the beginning has been to move to St. Louis and do real estate full time. We were originally thinking in terms of waiting till I turn 66, in 2020. However, the combination of my age, the pre-existing plan to move to St. Louis, and the possibility that the market for our Albany house will be worse in 2020 than it is now, have combined to persuade us to sell and get out sooner rather than later. Bay Area homeowners who are not at the age or other circumstances where it makes sense to sell out and move East should at least look into getting a HELOC and using it to buy properties in positive cash flow markets.

I was glad to read this because this is what I am looking into -- I'm in the process of getting a HELOC to purchase multifamily properties elsewhere (midwest, St. Louis is a main area I'm looking at!) and once I get a few, I'll probably move out of California. There are a lot of nice things about living here but it's not a place for real estate investing at the moment (at least not with my net worth, haha)

Hi Justin,

St. Louis is one of the main areas I've been focusing on to get started in. From what I understand, STL has a lot of REIA (real estate investor association) meetings, which can be a great way to network and make connections. There are probably other real estate meetings you can find on meetup dot com, or even in BP forums here -- just be wary of meetings that may be trying to sell you something (like expensive courses). For networking, keep in mind it's the mingling before and after that is probably more important than even the meeting itself.

I assume you've been checking out the resources and guides here on BP.  I'd also recommend learning from podcasts --  I spend a lot of time in my car due to a long commute, so I have more free time to listen than read.  If you want any podcast recommendations, feel free to PM me and I'll send you all my favs!  

Yeah, I think this really depends on what you have an appetite for -- if you want all the money now then this may not be ideal. The trust comment caught my attention as well. Most lenders won't consider income from a trust (as in an irrevocable trust that defines the periodic distributions to its beneficiaries as income) when considering qualifications. If they want to carry a four year note and use trust distributions to pay it off, I'm guessing they don't anticipate trying to get a regular mortgage in 6 months (when one spouse will have reached 2 years of being self employed). So they plan on using just trust money to pay it -- either because it's simpler for them or perhaps even because their self employment income isn't enough to qualify. I would wonder what the terms of the trust are, although I'm not sure if you'd actually be entitled to that information. Some trusts have a set number that gets distribution -- x dollars annually or in more frequently installments. There are some trusts that distribute a percentage of the balance of the trust assets. But most commonly, trusts tend to distribute all income to the beneficiaries. If that's the case, then depending on what kinds of assets are in the trust, the income could fluctuate from year to year. (This may not matter, but I'm mentioning it just as a factor to consider to make sure the trust distributions are as set-in-stone as they believe.) One last thought -- if their trust allows it, could they make a note to their trust instead of to you so you can get paid up front? Example using round numbers: they borrow $100k from the trust in exchange for a promissory note at the applicable federal interest rate. You get all your money now. They make their loan payments to the trust. The $100k note is an income generating asset of the trust -- and as they make their monthly payments, if they're entitled to income from the trust, they're basically going to get that income distributed right back out to them. If the trust permits it, seems like it could be a win-win?