All Forum Posts by: Alan Grobmeier

@Nathan Gesner, that's the real kicker.  Why is the LL considering the applicant if the applicant can't meet credit score requirements?

I had a woman that threatened to sue me a couple of years ago.  I was in the application process, met with applicant TWICE during my open houses.  She told me her credit & income and I asked for an application.  Never got one.  I ended up renting to someone that went thru the process.  She threatened to sue me.  I said, "WTF, I don't even have an application.  On what basis did I 'discriminate' against you?"

Obviously she never sued me.  LOL.  

People are crazy.  Bullet dodged!  ;-)

@Enyi Ajoku, you should have declined based on credit score and then stopped.  If she doesn't meet your credit score minimum, there is only one word:  NEXT!

His profile does not have little pink houses on it, so I am guessing he is no longer affiliated. Looks like he has gone RE agent at this time.

Buyer CAN do anything they want.  If they want a 3rd party appraisal and THEY are willing to pay for it, all good.

But it does nothing to the contractual agreement unless it was in the original agreement.  If the appraisal is not any good, they walk away from the deal and you keep the earnest money.

Simple.  Don't sweat it.  I wouldn't.  You can probably raise the price by 10% if they don't follow thru!  ;-)

@Jimmy Lieu,  The main reason for a buyer to use seller financing is because they can not get access to money, usually due to credit, bankruptcy, or somehow over-extended.

The buyer will usually overpay for a property due the fact that there are no banks or appraisals involved.  It's just 2 parties that make a deal.

As far as an answer to your #2 question:  I would do interest only loan (say 7-10%) as a seller financed deal with a payoff in 3-5 years.  Buyer overpays, puts $$$ down, and I now collect interest before my final payoff.  If they are unable to refi, I foreclose via contract. 

In response to your #3 question:  The buyers of owner financed properties may have great jobs, cash, or income, but are unable to get a loan.  That makes owner financed deals lucrative.  The seller can name the price AND terms and the buyer either takes it or leaves it.  Not very many NICE properties are sold in this manner.  In this market, it would be tough to find ANY properties sold via seller financing.  And many might have great jobs, but not enough cash for a good down.  So the price is elevated to compensate for that added risk.  It really depends on the parties involved.

For the seller it is a liquidation of an asset without taking a complete hit.  Can be sold in an 'installment sale', see your CPA for that one as I won't try to explain it.  Basically it's almost 'net' the same $$$ to the seller as renting without the headaches.  Usually done by owners at end of career/retiring, but not always the case.

Hope this helped.

Alan

@Taylor Combs, have you thought about selling less than a 50% interest in the property?  That could get you the cash you want without having to pay cap gains and still have control of a rental (although now you have a partner or 2).

@Brian Garlington, you only sell naked puts on stocks you MIGHT want to own.  And if you sell outside of the first standard deviation, you have about a better than 85% chance of winning.  And I LIKE winning! ;-)

If you 'lose', you take the stock and sell calls.  At a price above what you paid.  The premium you get will probably be north of 20% AROI AND probably a better than 50/50 chance of your shares being called away.

@James Wise, I absolutely LMAO today on your new YouTube:  Previous evictions:  10 times it's ok to rent to a tenant with an eviction.

No & 'F NO' are the ONLY answers!

@Anthony Vander Meer, only if you want to get paid consistently.  ;-)

@Carl Mathis, in some instances it already has turned ugly.  Have a look at the link below where the deadbeat tenants were kidnapped by their landlord & dumped into a cemetery in the freezing cold.

Deadbeat tenants are part of the risk when you get into this business.  EVERYONE understands that part.  But, prior to Covid, we had a process that dealt with these issues.  Now the LL is responsible for housing ppl for FREE & still do maintenance AND pay property taxes.  With ZERO help from the govt.  

The govt can bail out fortune 500 companies, Wall Street, other countries, but NOT 'we the ppl'.  Extremely sad.  

AND it WILL get uglier. I'm already seeing it. Look at the requirements some new rentals have had. I have seen requirements such as a 680+ credit score, 3x rent = income AND DTI requirements. And this is on top of inflated rents! No LL is going to take a risk on anybody 'sketchy'. If you get evicted, your next stop is the 'barrio' or the street.

Not sure the govt's intent.  It looks like they want to own it ALL & more!

There is no way a LL in NY or IL could have enough $$$ reserves when a vast majority of their tenants refuse to pay rent for over a YEAR.

https://abc7ny.com/landlord-ki...