I really took notice of the fact that you prefer L/Os.I have been retailing "Foreclosure Rehabs" for about 2 years.I have sold 90% of them by taking a second mortgage,many times non-collectable(by my own choosing).Down payment and closing costs are always a problem,which I usally rectify by picking up a large majority of those costs. I know it sounds like Im giving away the store, but there is still a nice profit left.
But I have just recently decided to go full-time into REI, and realized that there are many ways to skin a cat.
Can you please give me some advice on which way to go concerning L/O`S.
Looking forward to your response.(or any others)
I finally I got one under contract! Last night I received the most wonderful message from a listing agent of a home I made an all cash offer on a few days ago. Seller’s agreed to ALL of my terms including my weasle clause. Here it is:
Nice 4/1 SFH on quiet street.
Purchase $ 32,500
Hand Money $200
Carpet & paint $2,500
FMV $45-48,000
FMR $500-550
I plan on refinancing NOO up to 90% of appraisal after purchase & light rehab to pull out all cash invested. Questions I have would be should I rent, L/O, or sell on a LC? Please indicate whether a 15 or 30 year refi(30 year is @ 9.25% - 15 year is @ 9%) would be better and should I take cash out from the refi. I appreciate any suggestions in advance. This is truly a WONDERFUL DAY!
Hey John,
Good job, congradulations. The only thing I was curious about was your plan to get a 90% LTV refi on a non owner occ property. Do you have a source for this? The reason I ask is it seems like the best I ever seen on a cash out refi for non owner occ is 80%. Good luck and I hope it works for you.
Posted by ken in sc on April 13, 2000 at 08:18:33:
Sounds good.
As far as the rest, it depends on your goals. Do you want rental property or do you want to sell as a dealer. You need to decide that before you take title.
If you plan on doing both (rentals and sales) this year then the question is: Is the property going to go up in value over the next ten years better or worse than other houses you can buy. If better, keep as a rental. If worse (neighborhood is declining or has been at the same values for yrs), then I would sell for $49,900 financed. You could sell ls/op which is my personal favorite, or you sell with a note/mortgage and then sell the paper and cash out. If you go this way you may not have to refinance your mortgage if you can spare the $2,700 you have in it until you close the note sale.
This brings up a small point (then I will quit talking!), if you can leave these small downpayments in the houses for the ls/op period or until you sell the paper, think how much you will save over the years in closing costs! If you can’t do it yet, consider setting aside some profit from your first couple of deals in order to be able to do that in the future.
So, good luck and keep going!