All Forum Posts by: Derek Dombeck

@Travis White

It appears the seller is amortizing the loan over a 10 year term where as your payment calculation looks like its amortizing over a 15 year term. You need to figure that out with the seller. If you do agree to a 10 year term, you will be gaining $630ish per month in principal reduction vs $345ish per month on the 15 year term. 

I would consider leasing this house with an option to purchase to a tenant/buyer. You can get a premium sale price with above market rents if you structure properly.

Happy Investing

Derek Dombeck

Yes you can get a warranty deed. The challenge comes in with closing on a subjest to. I usually close in a trust for purposes of avoiding the sellers due on sale clause. If you have never done 1, you need to study extensively or have an experienced mentor to walk you through it. There are some hurdles to get over with them.

Happy Investing 

Derek Dombeck

It appears as if you are banking on appreciation to get a return. The challenge is, nobody can guarantee appreciation. I would rather lend out that $300,000 at 10% to other investors at a loan to value not exceeding 70%. In the same 3 to 5 years, you can exceed your expected ROI with much less risk and very little work. The only downside to lending is when your borrower pays you off, you need to find another borrower.

Happy Investing 

Derek Dombeck

@Mark K.

I know it is all market specific and there is also an Internal Rate of Return to consider as well, but you could easily get the same or better case on cash return by being a lender to someone else and not have the stress and management of the property. I would personally not risk that much cash on that small of a return. In your market, is it hard to find better rentals than that?

I will say that I may be spoiled in the Midwest as we can buy cash flowing properties fairly easily. 

Just a different view point to consider.

Happy Investing 

Derek Dombeck

@Matthew Michels

Size does not matter! Lol. Sorry, I could not resist.

Seriously, the main points are simple. If there's a for sale sign in the yard, they are soliciting for you to approach them. By the way, it's ok if it's a realtor sign. Go up to the door, knock, and BACK UP 20 FEET. People feel much more comfortable if they can look out and you are not right up its not their face. When they open the door, say, My name is Matthew. I see you are selling your house. I love your neighborhood and I'm looking for a house here. Can you tell me about yours? Almost every time, they will start to tell you about it and after a little bit they will ask if you would like to see it. At that point, they invite you in and you have a conversation about what their needs are. It's important to listen to them much more than talking about yourself. 

If there's not a for sale sign in the yard, you do the same thing, except when they open the door, you say, HI my name is Matthew. I know this is going to sound crazy, but I love your neighborhood and I'm looking for a house here. Do you know anyone who might want to sell theirs? 

They will either say no, or they will start pointing up and down the street like a traffic cop telling you about everything that happens in the neighborhood. Or they may invite you in to talk about their house. This is a great way to approach people who may be tax delinquent or behind on payments without them knowing that you targeted them. If they aren't interested in selling, knock on the next door down or where the mentioned a neighbor may be thinking about selling.

Repeat, Repeat, Repeat.

Tip..... if someone has a sign in the yard for a car,or boat, or yard sale, etc., start a conversation about that sign first.

Hope that helps.

Derek Dombeck

@Matt Taschner

If you purchase the property subject to her loan staying in place, you will at least stop the bleeding on her credit and over time it will improve as you make on time payments. 

Another strategy.

 If the seller, with your help, can get a loan modification done prior to you buying it subject to, you can avoid the initial catch up of $11,000. It will be added to the loan balance, so either way you will end up paying it.

 Caution. Be sure to have a Power of Attorney in place as well as perhaps a signed deed before you get this loan mod done. I've seen people go through all the work only to have the seller refuse to sell after the loan mod was done.

Happy Investing

Derek Dombeck

@Chris Rommes,

I'm looking forward to meeting you at the Green Bay REIA. My business partner, Jeff runs it. I run the Central WI REIA in Wausau. We are always happy to see new faces.

Happy Investing

Derek Dombeck

Go to another lender. Perhaps, find some local mortgage brokers. Every lender has different criteria. If you have a local Meetup or REIA, go and talk to other local investors to find out the best lenders in your area.

Happy Investing

Derek Dombeck

@Greg Neuman and @Eric M.

Cal Tillish in Wausau is one of the most creative attorneys in Central WI. This doesn't mean he's great, but he is better than most in the area.

Happy Investing

Derek Dombeck

If you can choose to outsource the tasks that you don't enjoy and then focus on what you love, You will enjoy Life more..........

Happy Investing

Derek Dombeck