Quitting IS the solution... - Posted by Rich

import · March 16, 2001, 5:43am

Posted by Rich on March 16, 2001 at 12:06:33:

Ed,
Thanks for the vote of confidence. I don’t feel very confident, unfortunately.
Here’s the deal I offered him yesterday -
You (Mr. Partner) give me (Mr Rich) $30,000. I get out of hock. Mr. Partner and Mr. Rich go to the attorney and have both properties put in both of our names. We then go to the bank and take out a new first mortgage. One that pays off the entire $18,800 balance of the rental property, and gives back Mr. Partner his $30,000. We then pay off the new loan from the proceeds of the business. I ran it past my attorney and he thought it would work. Mr. Partner gets into two properties with no money out of pocket and half of a mortgage on a potential serious income producer. Plus a rental property that kicks $450 a month toward the new mortgage.
I thought he would jump at the deal. He hasn’t yet.
What do you think of my proposal?
Thanks. - Rich

import · March 16, 2001, 5:43am

Quitting IS the solution… - Posted by Rich

Posted by Rich on March 16, 2001 at 06:43:37:

I read a post below from Scott about his trials and tribulations with trying to obtain a loan. As many of you who have read my previous posts, I too have had a time of it in the last year. Most recently, I was speaking to an officer of my bank (who I have 4 mortgages with) and asked if they could cut me some slack on letting me make it through winter (I couldn’t afford to put heat or finish the renovatios in my commercial building). The individual I spoke to said they would try and work with me, and they wanted me to write a hardship letter and to return a package of information that they were going to send me. The day after I receive the package of information, I receive a certified letter in the mail from an attorney for the bank, notifying me that they are going to auction off my commercial property at a foreclosure sale on March 27. They are also going to auction off a rental property I own that they had used as collateral…($100,000 in equity combined). I called the attorney and I told him that I had been discussing a plan of action with a person in the bank’s New York office and that they were going to try and work with me. He said the person I was talking to in New York didn’t know what they were talking about. He did tell me if I could come up with $7700 before the auction, they would call off the dogs. If I could come up with the $7700, I would have put a furnace in my building. I have managed to sell a few things to scrounge up a little over $3000, but time is running out.
An individual who was interested in partnering on the building has taken a beating in the stock market and had some margin calls come due in the last week, and said he can’t get involved with anything right now.
My other recourse is to file bankruptcy. Now I see where the banks have wooed our congress and senate to make filing bankruptcy more difficult. My only hope is that I can file before the law takes effect.
Although I believe in Ed, I think in my situation, quitting IS the solution.

import · March 16, 2001, 9:55am

Re: Quitting IS the solution… - Posted by Ed Garcia

Posted by Ed Garcia on March 16, 2001 at 10:55:22:

Rich,

Thank you for believing in me, but you’re the one who’s in trouble and has their butt on the line. The reason I say that is to tell you, that I BELIEVE IN YOU.

Rich, don’t get a BATTLE confused with a WAR. To be in trouble on this deal wouldn’t mean that you couldn’t do other deals. If you should lose it, it doesn’t mean that you’re a quitter either. But I no longer want you to be a victim of circumstances, so let’s talk about your deal.

There is no question that you have a property with equity and you’re fighting to save it. The problem with your deal is that even if you come up with $7,700 you don’t have a GAME PLAN, and if you did, you don’t have the financial ability to carry it through.

Here’s what I would do, and I would do it today. I would call up the potential partner and tell him that you would like to have a meeting with him.

In that meeting I would tell that individual that I’m sorry about his misfortune with the stock market, but that you can give him an opportunity to recover. I would then tell him that he could become your partner with just $8000 down. Tell him that you are willing to take the $8000 down and carry him for the balance until the two of you get the property up and running. Tell him that you think his idea is a good one, and that if the two of you could work together, you could make the building a winner, by him using his credit to refinance the build etc. and that the both of you will benefit by pooling your resources, you the building, him, cash and credit.

Rich, if you don’t have a solid GAME PLAN to save this building, then Bankruptcy may not be beneficial to you. I’m sorry that I’ve been so busy, and not able to concentrate on your problem, but as for now, time is of the essence. You’ve got to work with what you have, so go back and rework this potential partner. Remember, a half deal is better than no deal, besides, you’ll be saving your credit.

Ed Garcia