Posted by Brad TX on November 09, 2000 at 15:59:02:
Also - did you pay the arrears, or let’em sit until you had the money from your buyer?
Just curious on the details of your purchase.
Thanks.
More Deals to do, But out of money - Posted by Stephanie
Posted by Stephanie on November 09, 2000 at 08:40:12:
I used a home equity line of credit to jump start my REI, but now that is gone until I sell one of my rehabed houses on a L/O, but I am scheduled to close on another foreclosure here in a couple of weeks. I would like some creative ideas - I am already approved for the loan it is just coming up with the 10% down & closing ($7K approx) I really don’t want to dip into retirement - my boss wants to get involved - should I ask her to put up down & closing and do a note with her for (10%??) I am purchasing the foreclosed property from a local credit union and am planning to just rehab it and sell it on a L/O. I already asked the bank to write purchase amount for higher for rehab monies and he said that he would rather not - I am a newbie and don’t feel very creative yet - I welcome any ideas!
Thanks for all of everyone’s help on this board.
THANKS FOR ALL INFO! - Posted by Stephanie
Posted by Stephanie on November 10, 2000 at 08:19:06:
I will try to shape my mind creatively!
Re: More Deals to do, But out of money - Posted by dewCO
Posted by dewCO on November 09, 2000 at 22:03:36:
Doubt the lender will allow you to “borrow” or use money not currently in your accounts to close on this. But, they might let you bring on a partner. The boss??? Make sure and put everything in writing, and hope you still have your job in the end (may be just joking, who can tell, stranger things have happened).
As the others have said, you’re going to need to get creative fast, if you’re going to keep doing deals, unless you’re just flipping 'em.
Re: More Deals to do, But out of money - Posted by David Alexander
Posted by David Alexander on November 09, 2000 at 14:39:26:
Yeah… ditto what Bud said. You’ll go from too much cash to little cash, way too much, to way too little.
Learn to only put cash in where you get the cash out, and preferably a little extra.
ie. recent deal I did bought a house for 65k (6.5%)with 5k in arrears, 2k in repairs, sold it on a wrap for 8k down and carried back an 77k note at (11.25%) Not an major killing but a solid first base hit. But the important thing is that I dont have any money tied up in the house, plus I had the cash growth added. Took less than a month to move this deal.
That may mean only putting enough in to get it all back out on the exit, which in turn means you need to learn more exit strategies than just L/O.
David Alexander
Nothing new - Posted by Bud Branstetter
Posted by Bud Branstetter on November 09, 2000 at 09:25:30:
The bane of all investors-out of cash!
Instead of doing a rehab on that foreclosure you are buying you could flip it to another investor. You give up the BIG payday for the quick cash. Then there is hard money that you give up some of your profit for the quick financing. Or there are partners that may want a cut of the profits. As you get better at finding private investors you can give them a fixed return and avoid the hassles of hard money.
It also appears you need to get friendly with some good mortgage brokers. Instead of L/O run them by the brokers to see what kind of financing he can get them now. It may be that you wait a few months to find that buyer to cash you out.
Another alternative is to learn how to not put your money into the deal. This includes sandwhich leases and Pactrust type of deals. Then there is selling the note as an exit stategy.
Putting down 10% and qualifying for a loan is not creative. You can definately make money but you are slowed down quite often. Getting a seller to take a note on the equity on another property you have and selling the owner financed note on their house to get you in without any of your money is just one example.
Re: More Deals to do, But out of money - Posted by David Alexander
Posted by David Alexander on November 09, 2000 at 18:15:53:
In this case had to pay the arrears because the foreclosure tuesday was the next day. but you always try to keep the cash from going out of your pocket, that way it’s all the less you ahve to get back.
David Alexander