All Forum Posts by: Steve Hall

@JP P. Your numbers don't make sense.

@Nicolas Da Silva

Tell us the cash flow with the debt service and without, and then what the cash flow would be with the PMI.

BTW, you called this a legal duplex, but did not call it a legal non-conforming triplex. Do you understand the risk? Have you talked to an attorney, or were you hoping to save money and not hire one?

@Austin Whelan

When you say "House", I assume you mean SFH. When purchasing residential properties, real estate agents in most states have their own boiler plate forms that you e-sign. There is no way to change them.

If you don't like a written provision, there is usually an "Additional Terms" section. I have my agent write in that section that "ABC" is to happen, which "supersedes paragraph XYZ above"

When you get into bigger commercial deals, you should have your attorney draw up the contract. He may need to negotiate with the seller's attorney.

Regardless of whether you buy residential or commercial properties, ALWAYS sign your contracts in the name of your trust or LLC. If you don't understand this part, your attorney will explain it to you.

@Barri Griffiths

Sounds like you are in over your head. You should NEVER involve the seller in ANYTHING after the sale, other than seller financing. You need an attorney. Go hire one tomorrow to review your contract and set up your business structure for the purchase. Hopefully you made sure your contract was assignable. (Since I'd bet money that you signed in your own name.)

Good luck!

@Jason Lethcoe

Learn to use the forum search feature.

@Clint G. 

1. They are not brokers, they are real estate agents who work for a broker.
2. You wasted their time looking at 10 homes, and then bought one you found elsewhere. Can you blame them for not bringing you any more listings?
3. In most states, the buyer does not pay the agents, the seller does. If you are buying listed properties, then why not use an agent?  It's free, and dealing directly with the listing agent is usually a hassle anyway.
4. Real estate agents work in the residential sector. You are buying SFH (which is residential stuff.) Once you start buying commercial, then you can use a CRE agent or broker and they will bring you stuff faster than you can keep up with it.
5. If you are buying off MLS, then DO NOT use an agent.

• How much money do you have to invest?
• Do you already own a home?
• Do you like managing tenants?
• What is your goal / reason for investing?
• Do you prefer cash flow, or appreciation?
• Do you have rehab skills? 
• Do you want to be active or passive?
• How do you feel about having partner(s)?
• How much time do you have to devote to investing?
• What scares you the most about real estate investing?
• Do you have friends, relatives, or colleagues that are investors? If so, what niche are they in?

Once you can answer these questions, it becomes obvious which niche is best for you...

• Get at least 3 bids.
• Don't give the GC any money up front.
• Oversee the project personally.
• Don't pay in full until the job is done and the waiver is signed.

NEI... Not Enough Information.

@Jeremy Dockendorf

1) My point was that it's a 5 year balloon. You have to be 100% sure you can qualify for a bank loan in 4.5 years, otherwise you are risking your $100k, your $45k improvements and any principal you pay down in those 5 years. (You obviously don't think you'd qualify today.)

2) If this is a personal residence, I don't see why you think you need to put 20% down. Plenty of lenders will give you a loan and require less money down.

3) You can get a 30 year fixed jumbo mortgage for 4.25% now. Do you think it will be lower in 4.5 years? Is that why you are willing to pay 5% now?

4) Sellers charge a premium for seller financing, they don't discount for it.

Could you even qualify for a traditional loan if you found a lender that required 10% down?