All Forum Posts by: Roman M.

Borrower wasn't paying for 6 months and just resumed payments 2 months ago.  We developed a good communication with the borrower and he wants to stay in the home. 

Unpaid Principal Balance is $67,241.40. Overdue charges and payments are $4,575.40

Monthly Payment is $430 per month consists of $391.08 Principal and interest plus re tax escrow of $37 per month.  Fixed rate of 5.5%

Property is a 1 bedroom, 1 bath single family home per property records. 

Lots of growing equity in the home as it is in highly appreciating area close to Wynwood area of Miami and Miami International Airport. 

Property valued at approximately $100,000.

Asking $55,700

We have excellent payment record keeping on this note and all original notes, assignments, etc.

Please send private message if interested and want any additional info.

6 month waiting sounds about right however if you buying the house for $80k it may lower your future appraised value. You might need to buy it for $135,000 to maintain the equity high. What if you can record a second mortgage on the property before the purchase under let's say XYZ Corp and then have it paid off when you buy the house for $135,000. Just a thought.

Stephen,

You should really compare the numbers and take in account that you will be an absentee landlord. I am not sure how possible is to get a heloc against investment property & how high is the rate but if you decide to sell you should consider doing 1031 exchange into the new property so you won't have to pay gain taxes on the sold properties. 

Bad debt is when you borrowed money from a lender and they could not collect and they write it off as a loss and give you a 1098 as if you got income.

Interest earned is taxable. Principal is not taxable. 

Loans are not taxable unless they are written off by the lender as a bad debt and the lender issue 1098 to borrower. You only have to pay capital gain tax if you sell assets. If you LLC is setup as a partnership and not a corporation then all taxes passed through to your personally.

Jim,

I am not sure how you can finance a purchase without a down payment. Any lender will want your skin in the game. 

Your best bet is to ask seller to finance your down payment or bring in a partner.

You need to thank federal/state regulators for this. Lending to a natural person and/or owner occupant is highly regulated and that is why most HML are doing only business to business lending (meaning lending to your LLC). Also there is a higher CAP on the rate that HML can charge on business to business lending.

It's called leasehold interest and you will be looking for a loan against it. Make sure you lease is long term, like 50 years plus. If it's short term then I doubt you will find a lender but do ask them what is the minimum term of leasehold they can finance.  I have seen tons on these loans before re market crash in 2007. I am not sure how hard it is to find a lender for this type of loan these days. 

Chad, you need to get more information regarding what stages of loan default is she.  If $5,000 is due next month:  is it what she is behind on or this is the final judgement amount? At what stage of foreclosure is she?  If they just sent her a demand notice then she has time however if the lender already obtained final judgement then she doesn't have a lot of time.  Foreclosure process takes time and there are plenty of ways to delay the process until she figures out what to do. 

Assuming, she is in Florida and is in the early stages of default, she needs to reach out to the lender and explain her difficulty.  No lender wants to foreclose and if they see good faith to make it good on payments (maybe no right away but at a later time). They will work with the borrower.  Even though she is not on title, she is owner's wife and they should be able to talk to her.  Make sure she has husband's basic info, like social security number when she calls. 

My first approach will be to ask if she can make just the monthly payments for now and have lender wait on collection of the $5,000.  Most likely they will agree with that but it all depends on the lender.  So long that she keeps communicating with them on the progress they may allow her to stay behind $5,000 so long she is keeps paying monthly payments going forward. 

It all depends on the lender though.

I was looking into funding deals myself in Miami/Browaed area but ran into road blocks of finding clients who will want to borrow for projects.  It seems that all the big hard money lenders already have steady relationships with the flippers/rehabbers and I did not want to go with a newby investor on a rehab project.  

Also you do have to go thru a licensed mortgage broker in order to stay in compliance with the mortgage license regulations, or get a mortgage license.

I think it's a good area to be in but it is a job as you constantly have to look for borrowers.