Posted by George(OH) on March 24, 2000 at 18:23:51:
“Ultimate L/O Strategy?” I’m waiting for it to arrive in the mail right now.
Thanks,
George(OH)
L/O Question - Posted by Tim Jensen
Posted by Tim Jensen on March 22, 2000 at 20:30:03:
Hi All,
I am wondering, a couple of things.
First, do any of you L/O 2 bedrom houses?
Lastly, How do you answer an owner when they ask how do I know that you will make the paymenst? I got this from an owner tonite and was not sure how to repond.
Thanks,
Tim
Thank You All! - Posted by Tim Jensen
Posted by Tim Jensen on March 23, 2000 at 21:30:45:
Thansk all!
Re: L/O Question - Posted by David Alexander
Posted by David Alexander on March 23, 2000 at 18:28:59:
TRandle’s answer said it best. When a seller brings up that issue it’s a trust issue.
I usually just tell them that I dont make my money for the long hall as my profit is mostly on the backend and this is what I do to put beans on the table. If I dont make this go My little girl doesnt get to eat, and I’m pretty particular about her eating.
Anyway, that’s my spiel.
David Alexander
Re: L/O Question - Posted by GregNorman
Posted by GregNorman on March 23, 2000 at 15:08:31:
Tim,
2 BR can be harder. It would put up a red flag, but wouldn’t prevent me from doing the deal. I recommend having the lease start upon occupancy (or give yourself 45-60 days before you first payment).
As far as making payments: I’ve looked for an escrow company around here and I haven’t been able to find one that will do it for less than $50/mon (I live in a big city). So I just tell them I’ll give them 12 predated checks. I just saw something recently that I may incorporate: If you are worried the seller won’t make payments, make the 12 predated checks out to their mortgage company, and let the seller send them in. I also show references and am a member of the BBB.
Good luck.
GregNorman
STILL Thanking Joe Kaiser… - Posted by Scott (AK)
Posted by Scott (AK) on March 23, 2000 at 12:58:10:
Tim,
Following Joe Kaiser’s advice to set up an escrow and payment collection/distribution was one of the best moves I ever made.
“Mr Seller if you would like I can have the company that handles my payments send you a few statements of other accounts so you can see exactly how well we make our payments. I’ll have them fax a few to you right away.”
I’ve found this to work even better then a credit treport because this is real estate specific and they like the fact that I am willing to show them other accounts because we have nothing to hide.
Put that payment collection/distribution company to work for you and you’ll find a variety of ways to use the info they provide.
Thanks Joe!
Also about 2 bedroom homes, I know a LOT of folks live in 2 bdrm homes. Just do your diligence and make the terms of your deal with the seller in accordance with that research.
Hope this helps.
Scott Smith
Re: L/O Question - Posted by Mike
Posted by Mike on March 23, 2000 at 09:48:01:
Don’t know about two bedrooms, but as far as making payments, you could set the entire thing into an escrow or other third party scenario, where that third (and totally separate party) excepts all rents and makes payment on all debt service. Try a local RE lawyer or escrow company for this.
Re: L/O Question - Posted by TRandle
Posted by TRandle on March 22, 2000 at 20:59:31:
“Mr. Seller, you’re aware you can check the status of your loan anytime you wish by dialing the lender’s 800 number, aren’t you? As I stated before, I make my payments directly to the lender so that I know it’s paid, and you can check each and every month if you would like. Additionally, my real payday is not until I actually sell your home and it takes a lot of work to get to that point. In my contract, it states you can take your home back, yada, yada, yada,” It usually only takes one…
Re: L/O Question - Posted by Tarun_md
Posted by Tarun_md on March 22, 2000 at 20:43:30:
Tim,
It is possible to l/o 2 bedroom houses. They are just a little harder to market. I would get more time before my payments began.
For your second question, I would tell the seller that once you find the tenant buyer, YOU WILL MAKE THE PAYMENTS. I would go as far as providing them with references of people I have done business with(I have done that in the past). Once they see that you own a bunch of rental properties(I know you do…Tim), it should make them feel better. If they still want some sense of security, give them 1 months prepaid rent.
If they are still not convinced, they are not motivated enough.
Just make sure that you get enough option consideration upfront to cover any vacancies.
Tarun