There are NO foreclosures in Ontario. Instead we have Power of Sale. On a Power of Sale property, the bank (seller) gets at least 2 appraisals, lists the property with a big real estate brokerage and sits back waiting for offers.
The only offer they will consider is for all cash, at least 90% of the asking price, with no conditions. Any other type of offer they will throw back in your face. And if they sell for less than FMV they can be sued.
No tax sales either. In the last 20 years in my town there have been 4 tax sale properties, all abandoned industrial sites with soil contamination problems.
I know it depends on what the homeowner needs but if you had your choice (and cant pay all cash), how would you try to buy a property? CFD, Lease Purchase, Subject to, Conventional financing. WHich are the most straight forward for the layperson and are easiest to start with. Thanks for any responses…
Re: your most used strategies - Posted by Kristine-CA
Posted by Kristine-CA on July 30, 2003 at 13:56:30:
I think it depends on what the exit strategy is–I can go into contract with anyone if the price is right because I know I can sell it to someone else for via assingment or double close. I rarely close with my own cash (because I don’t have that kind of cash).
And, I have to say, all cash contracts with 30 day closes do speak pretty clearly to a lot of sellers.
Now, if I wanted to keep these properties for my rehab project or as rentals, that would be another story. I would always try to lease/option (especially a rehab) or option to buy with as long an option period as possible. Trouble with that is that almost every seller that contacts me would rather get cash now than carry any paper, even with a better price. They would go with a lower cash offer if another investor would make one, rather than give me any kind of terms. There is a lot of need for my sellers to be done with the property. Many sellers have already had plenty of bad experiences with carrying paper and would let property sit before they will carry paper for anyone.
I got into rehabs and didn’t have any money or credit.
If I wanted to build slow wealth and keep my job, plus have time for family, I would probably buy subject-to or owner-financed, and get each deal working nicely before moving on to the next one.
Re: your most used strategies - Posted by M.Osterman
Posted by M.Osterman on July 30, 2003 at 11:10:10:
The stratagy that I employ is doing flips (wholesale). I find property’s ( discount ) then flip to the people with the cash. You can profit anywhere from 5-10k. It entails you finding a deal, getting it under contract and then selling your contract to another buyer. You never own the house, and you get paid realativly quickly.
So are you saying that you offer all cash in the contract and then assign or double close to someone who has all cash? Does the seller care that you wont be buying it? Are these other investors you assign to individuals with alot of money or companies? Thanks again.
Borrowed money from relatives on the first deal. Took title subject-to existing financing.
Borrowed money from private lenders secured by note and deed of trust on some other deals.
Used a hard-money lender that loaned 100% of purchase price plus rolled in closing costs. I still needed to pay for the appraisal and inspection up-front, and have a reserve for repairs and holding costs, but I used borrowed money for that, too.
I borrowed money from private lenders (former employer, uncle, friend, vendor, doctor, etc.) secured by whatever properties I wanted to buy. Paid them monthly interest-only payments (10-18%). Paid back the principal when I resold the house.
Posted by M.Osterman on July 31, 2003 at 11:16:44:
I wish I had one. I’m working on a system now (forclosures) that will bring me more leads. So far I’ve contracted 6 property’s this year. ( Again this is my first year) Thinking about those, 2 were from postcards, 2 from bandit signs, 1 referral, and I guess it should be three postcards. Two of which are in foreclosure, 1 mobile home, 1 convetional, and a hard money loan. I know I’m missing one…hmmm I’d have to look. Anyhow, I try and do a number of things that generate leads. From what I’ve heard, this is the best way to generate leads. I also have a newspaper ad and signs on my car. ( both have generated 0 in the lead colum.)
Re: your most used strategies - Posted by M.Osterman
Posted by M.Osterman on July 30, 2003 at 11:56:08:
Sure, you can flip anything. I have a nice home in a nice neighborhood for sale. Actually, I have a contract for sale. I’m “flipping” my contract to another person for a profit.
Kristine,
I don’t suppose you can email me a copy of your standard purchase agreement. Now I understand that they are different in every state but I have looked at Sheets Purchase contract, I have looked at Realtors contracts and I have downloaded one from a FSBO site. They are all pretty different. So would it be possible for you to email me or fax me a copy of the paperwork you take to peoples home when you say " ok Mr. Motivated seller lets sign a contract and get this going." or whatever you say. Just so I can see what it looks like so when I go to do that and assign it to someone I have more of an understanding.
My fax number is 603-720-0589
How big a town or city do you live in? I live in a small town Pop. 15000 and these quick flip strategies never work for me. I think it’s because of living in a small, conservative town what do you think?
Re: your most used strategies - Posted by Kristine-CA
Posted by Kristine-CA on July 31, 2003 at 23:26:04:
Jorge: I use the CA Board of Realtors Offer to Purchase/Joint Escrow Instrux contract. I have clauses and addendums that fit my needs.
You should be able to get one for your state from an agent or possibly buy them from the Realtor Board in your state.
I’m a firm believer in RE lawyers when it comes to docs. You need to make sure your docs are right for area and are going to accomplish what you need them to. That is what a good RE attorney is for.