All Forum Posts by: Rich Littlefield

@greg robinson I could be mistaken, I think from what I am seeing is that most wholesalers are finding properties, getting them under contract and assigning the contract before closing at a profit. 

Maybe, maybe not. FHA requires it to be owner occupied. The problem maybe that with the payments on the 12 units that the lender may decide you do not qualify for the FHA loan, so it is probably best to close the fourplex first if you can.

I would say that you need to be able to see the houses in person. 

To answer your first question, I would buy that property all day long.   You can get section 8 tenants, you can pretty much guarantee cash flow. I would write it directly on the leases that if they do not keep the property reasonably clean, they will be asked to move. 

Many lenders make you wait 6 months.  I know of plenty that do not have that problem.  The guidelines on purchase loans is always easier than refinance. The only big benefit of delayed financing is that on homes with a lot of offers, having a cash offer puts you to the front of the line.

I was not saying to buy online plans, but rather going to an on-line out of the area architect. If someone is in a rural area there may not be a lot of nearby architects. When I said you can get your plans online, I meant  you can go to an architect online. Sorry for the lack of clarity. 

It is actually easier to invest in the "Inland Empire" because the properties cash flow as opposed to other local areas. As a lender it is hard to put investors in properties in LA, Orange or San Diego counties as the  investment properties have so little cash flow.  If you go off to Texas, Kansas or somewhere like that, it becomes even easier to invest and get a good return on your money. 

Well that is what we have when people say they are "whole-selling" properties.  There seems to be plenty of people doing this. You could consider just getting a real estate license. 

What do you mean he does not own the property outright?  If you are saying that  he has a loan on it, that  happens all the time. 

There are some problems. If he transfers the title to you then it would trigger a Due on sale clause,  so they tend to do a "wrap around" which means the property stays in the name of the seller.  Then the seller can and they sometimes do, take out more loans and further encumber the property, effectively robbing the buyer. There are ways of dealing with this, years ago it was very common. Because of the problems around it not many people do it any longer.

The reason why not too many people do this, assuming you mean mobile homes on leased land.  Is that the land owners have a nasty habit of raising the land lease whenever they get a whim,  so you can really get stuck when you can not raise the rent, it does not cover the cost to carry, or even the rent on the units. 

Now if you own the land outright, you have a horse of a different color, I would say go ahead and buy and rent away.