All Forum Posts by: Sean Dawson

"What we have here is failure to communicate"  I don't think they would let me do that.  It's amortized out to 25 yrs. ... ahh wait, maybe I see the issue.  

its 4.8 with an adjustable after 5 years, the other one is 4.3 with a balloon after 5 years.  

Maybe you are suggesting I take the 4.8 arm instead of the 4.3 balloon and just mistype'd the numbers?

@Russell Brazil Yeah, those are the taxes paid.  Funny you mentioned reassessment.  Our local real estate group COREE, just had a presentation about that subject.  I will without a doubt be looking into that if we purchase.  

@Steve Vaughan  Yeah, Steve was a good guy back then.  Still see his folks at Church when I go back to visit mine.  

 I'm not sure what you mean about paying it off like a 20.  The balloon would still come due right?

@Steve Vaughan not from the Cleveland area are ya?  Went to school with a Steve Vaughan.  

Anyways thanks for the reply.  Should have mentioned that the building is submetered for all utilities.  There would be no utilities besides dumpster (still checking with the city on that one) that I am aware that I would be responsible for at the moment.

I have talked with some mortgage people about this.  One is offering 4.8% 5 year term then adjustable after that, 20 yr amortization.  Other is offering 4.3% 5year term then balloon with a 25 year amortization.   cant remember who said it, but the balloon feels like a slow moving bullet to me.  I see that you have some experience in this area.  I know everything can change in 5 years but how difficult is it to refinance before the balloon?  

'Evening!  I would like the hive's opinion  on a 12 unit multi we are looking at.  This will be our first foray into something more than our duplex's.

Via our agent the offer is now at $389900 with seller paying 2k of the closing costs.  

Rents are low for the area @ $520 per unit (2 BR 1.5 bath, half basement) Our property management company has others in  the area going for $600-$650.  I realize that the deal has to stand on its own as is though.

One unit is now vacant.  

I have figured 8% vacancy rate ($512)

Prop tax $13305

Insurance $5000

repairs/maint $3275

Cap ex $7000

Prop Man. 6% ($344)

This looks like 51.8% of gross

Mortgage I am gusstimating 25% down, 4.8% interest rate amortized over 20yrs for a payment of $1898

Total cash flow with these numbers are $1105

Do these amounts look reasonable, conservative, too low? As it stands the cap rate is 9.2%

The area would be C'ish I guess.  Nice single family neighborhood and close to shopping and freeway access.

Thanks!

@Mike Wall  Good on ya for getting one done.  Better than many investors who don't even start.  When I look at a property I have a spreadsheet that I took off of the files section and modified it for my needs.  That tells me what cash flow I should be getting. 

After vacancy, repairs, capital expense reserves, property manager, PITI I like to try and clear around $200 per unit. Sometimes that happens, sometimes it doesn't. If it doesn't then I see what area of town it is in and make the tough call then.

65k houses with $850 rents for me in my analysis are really borderline.  Might be a better play to take the cash and have down payments for multiple houses

Oh yeah, theres a webinar tonight at 8pm est for analyzing rentals

Just my opinion

@Rick Pozos  Thanks for the suggestions.  We will not be buying the property from them though as it turns out.  They are neighbors and we see them at Church, the pool and other places.  I figured it might be a win win for everyone but also thought it would be delicate since they are going thru a rough time.  Therefore I tried to do all my research before contacting them.  

They had already moved out and we were kind of stalking the house to see them when they came back to pick up odds and ends.  Well while waiting for them I did some more research.  I had been looking on the Clerk of Courts website to see if I could glean any info.  Nothing was showing up about their foreclosure or anything.  It was just speeding etc..  As luck would have it they showed up just as we were taking our son to soccer practice.  So hopefully they would be there when we returned.  

During that time though I had an epiphany.  I was looking in the wrong court system.  Once I realized that I found their info and the documents from the foreclosure.    They hadn't been paying their mortgage since 2011 and after the 5.5% per year on the unpaid debt it came out to $70k more than what it is going to go at auction.  We could barely scrape the cash to buy it at auction, no way we could take over their payments or pay the mortgage off, so it turned out to be a no go.  

Thanks for the help though!

@Matt Motil.  Your googlefu is strong.  Didn't see that particular website, but others along the same line.  None of them though really speak to buying it before.  In my limited knowledge of foreclosures though I thought they were just like normal sales upto the point of sheriffs sale.  Meaning the seller can sell them as long as the mortgage is paid off.  Hummmm.

@Matt Motil No doubt!  Nothing ventured, nothing earned!  Question I had though was, I guess, anything legally stopping me.  It would be most unfortunate for all involved if we worked something out and then were not able to actually go thru with it.  

Good Morning,

We have located a property that will be sold at a sheriff's sale in the next week or so in Ohio.  If we can talk to the homeowner and find out what they need, IE how much is owed and past due, is there anything stopping us from buying the house with cash asap?  

Would this stop the sheriff's sale?  We were thinking of getting a lawyer to draft up a sales contract and either paying cash or taking over their finances.

Thanks! 

@Ram Srinivasan  Yes, is there any update to this?