All Forum Posts by: Travis Sperr

Is he purchasing an investment property? Cash or financing?

I can see a lot of potential issues for financing if a 500k deposit shows up in his account. ALthough if he qualifies for the loan before the gold rush it could change things.

I am a hard money lender and am very confused by your question. We allow clients to close in entities, they also personally guarantee the loan. Some lenders require the borrower closes in the name of an entity because it is much easier to show the loan was “business purpose” rather than a consumer loan, which makes all the difference in foreclosing, loan pricing, etc.

Lending to a SDIRA is a different ball game as the loans have to be non-recourse, we do these loans, just at a lower LTV.

Justin,

This is exactly the way I got started in rental properties. I bought a triplex with a 203k loan. Fixed up the property, rented two units and lived in the other. This is a great way to get into a cashflowing property and help you to build your portfolio, also a great way to drive your wife crazy. I do not know where you are located or looking but, living next door to your tenants is not an easy position to take. Sometimes it easier to acquire multifamily as an owner occ because they are not discounted deep enough for a traditional investor

If you can talk her into stomaching the deal it could be your best property, but could be the most stressful.

Best of luck,

Travis

Hi Julie,

The biggest difference is financing, 1-4 family has the opportunity of being financed conventionally, typically easier to get financing. Once you get to 5 or more units a commercial loan is typically required, these loans can be difficult to get done under 500k-1mil.

Otherwise all ratios and metrics are the same.

I have purchased houses with tax liens and it typically shows up in the title report/commitment. In Colorado the title company does not allow closing until the tax lien expires (bank owned properties), if you purchase with a tax lien in place you can wait out the expiration (I believe typically 120 days), if you bring it to attention they might settle with you, although that means paying at least some of it. Speaking from my own experience in Colorado, but a title company or tax attorney should be able to help answer questions.

Sounds like a lenders policy, as a hard money lender I believe it to be best practice to cover your lender for the full loan amount. It is an additional fee, but it insures your family members retirement against any potential title defects up to the full loan amount (assuming it is beyond your purchase price). If the money is coming from a retirement account be sure you get the wire ordered with plenty of time to spare, every custodian is different in how quickly they move. Don’t forget to get your hold open policy for resell.

Looks like a deal. Don’t be afraid to pay asking price or more with the price drop, while you are thinking about it someone else might be writing an offer on the property. HUD is going to accept the highest net offer. As far as what HUD will accept, more than likely different in every state, but in my experience it has been a net of 88%. Net being after the agent is paid, so the offer would need to be a little higher.

Best of luck,

Travis

Hardwoods, it is a sizzle item. Although not adding any over all value, the property could be more marketable hopefully bringing you an offer. Depending on your financing, a $1000 now might save you a hard money payment or three.

Also I think the difference should be less, an additional $1000-1500 sounds high.

Burt,

In reading the posts and replies I am curious with what you decided?

Travis

Great responses, most of which are about monthly fees. I did get my license, I am an investor and hard money lender.

Depending on your state, becoming a broker can create more or less challenges, mostly depending on whether or not you want to employ other licensees.

I would see if your state differentiates Independent vs Employing broker.