All Forum Posts by: Aaron P.

Hi Chris, thanks for responding. If I were to refinance their property, would my credit be tied to the property? What would be another exit strategy besides them selling the property? To free up my credit once more.

Do I go to the bank stating that I'm looking to buy the property or from the approach that i'm "purchase" or refinance the property. . 

My Dad is totally against this approach, he's worried that it will be a huge "liability"

I wanted to ask if this would be considered a viable/legal deal? Or not worth risking my credit score? Or what can I do to make it legal.

Home owner has a property they owned 600k and shortsaled 2008 to a friend & family for 400k. Owner gave 70k for downpayment for the shortsaled house to friend & family. 

Owner still lives in the house but title is under friend and loan under family. 

Owner now has no means to credit the property to themselves, but wants to sell in the future. Can't sell the property now because of parents are living with owner, but may die in a few years.. So there are moving constraints for the Foreseable future. Owner has a debt settle as well with the family for 50k and is being pressured. The interest rate on remaining 300k is at 10-12%, and owner wants to refinance to a lower rate but is unable to do so since family/friend doesnt want to leverage their credit anymore. 

The owner is currently living and paying for the mortgage under the family/friends name.

Loan value is 300k, property value is 485k. 

I have the means to be able to recieve financing from the bank, at maybe 3-5% fixed interest rate. Would it be legal for me to take over the existing loan? And let say I save the owner 400-800$ a month, would it be unreasonable for me to ask for 100-300$ a month for refinancing their property. If and when they sell the property they will deed me 10-20k of the profits.  So if they hold on to the property I have passive income, if they sell sooner I get a lump some. They are willing to cover all "cost" of transfers. I'm still unsure of what may be the "cost of transfer".

I'm 25, looking to be more involved in REI in the next 1-3 years. So will this tie me down too much?

How can I best approach this deal?

-Aaron

I think they are talking about 20,000 is the budget. 

From what I've read so far in forums, before going to use the big guns (use a lot of money) you can start of by using methods like craigslist, backpages, cold calling or driving for cash. 

If you're jet set on spending a lot of money marketing, there's several websites that you can find under "BP resources" that can give you options for marketing (be it direct mail, or purchasing leads). Be fore you decide to start spending money on marketing, make sure to know what your "niche" market is so you don't sprrad yourself too thin and waste money on properties that would not interest you. 

Best of luck investing! 

-Aaron 

hey @Jeb Brilliant,

I've been lurking around the forums, I believe there are people in the BP that do solid deals and contract out work that work well. I've read some horror stories as well, but ultimately its up to you to do the analysis and due diligence (that is vague). As much as people want to help others there will always be a bias, and more often than not most times advice or "referrals" get them a nice "cut". If you know what I mean? 

Love the BP community lots of great people who share their experience the good and bad. 

-Aaron 

Hello BP Community!

     My name is Aaron, 23 yrs. old, I'm new to the BP community. I've lurked the forums for about three weeks now and watched/listened/read to various webinars/podcasts and guides on getting started with real estate investing. 

    I currently live in San Fernando Valley of the Greater LA county. I live with my parents and pay rent, and work as an RN at a hospital in Palmdale/Lancaster (northern end of LA county, meaning I commute 120 miles back and forth x3 days a week at a minimum).

    I've decided to focus on the niche of buying rental properties, be it starter single family homes as they are the most liquid/consistent type of real estate investment (2-3 bedrooms) and multi-family (greater risk/volatility and potential for profit) rental properties to build cash-flow.

First Year Plan (2015)

I have two scenarios in mind:

A. Purchase property in Lancaster/Palmdale

- Pros: market is relatively cheaper for single/small multi-family (1-4 unites) (125-700k), VERY CLOSE to work

- Cons: Larger inventory, many foreclosures (increased competition?), unsure about current market/population trend (up, down, or sideways), many of the neighborhoods are D/C class and at best a B class. Concerns about the quality of tenants, increased crime rates, and poorer overall demographic. (This may be a bias point of view as I work in the medical field and see the worst of the worst)

B. Purchase property San Fernando Valley or areas closer to Los Angeles

- Pros: market seems to be on an up trend, population is increasing, vacancy rates for rental properties seems to be lower, lived in this area for 10 or so years, Properties tend to be in the C/B/A class depending on the neighborhood

- Cons: Market is much more expensive (300k - 2mil), much smaller inventory, potentially at the pinnacle of the market, VERY FAR from work

Financial Status

    In terms of finance I earn about 70k conservatively up to 95k if I work an extra shift a week (gross income) as an employee, saved up about 12,000 in liquid assets (mix of roth ira/cash/tax refund) and I have no current loans besides a car for 15k that is amortized over 5 years. Looking to save an additional 15-25k by the end of this year by working overtime/saving 40-65% of my net income. 

I've considering doing a FHA loan and a 203k for my first income property; or potentially do a traditional loan if I do have enough capital for the property by the end of the year. If I can find a motivated seller/FSBO and approach it via subject to or owner finance to save on the down payment then that would be great (not likely?).

Goals/Outlook:

If I were to do a FHA loan/203k I'd lean to purchasing property closer to work, as doing overtime and not having to commute 120 miles x3-5 days a week would be icing on the cake [I don't mind living in a garage/basement of a single family or one of the units for a multi-family property]. If I opt to save capital and purchase a property in the SFV or areas closer to LA, I'd strictly rent the property and live with my parents (cheap rent and support the family).

I'm considering on getting a real-estate license to gain access to the MLS, and become more involved/build with/a real-estate business [I don't mind the fees/cost, what's important is the access to information and understanding the process; I believe that knowledge is power/priceless]. Short term goals are to build up assets and capital to do business, tax incentives/shelter (I currently have no tax deductions) , learn as much about real-estate as possible (I love numbers), and to move myself along the path towards becoming a well educated investor. I hope to meet many people, and contribute to the community. If you'd like to connect please add me, and potentially we can meet up and share thoughts. If you have any advice or thoughts on the direction/approach I can take please feel free to pitch in!!

[If you made it through that wall of text, High-Five!! You are a true testament to the quality of the community here in BP!]

- Aaron