All Forum Posts by: Al Bunch

Not being an expert on sub2's, how thin is too thin. For example:

3/2/2, 1656sf, nice neighborhood in an area that's headed for more residential development.
ARV is a solid $132k
Avg DOM 46
Seller owes $115k @ 4.5% over 30 years, note is 3 years old (4.5% is a guess)
Seller wants $8k in cash from the deal

Thoughts, opinions, anything you want to share about sub2's would be great (except telling me about the due on sale clause and how it may bite me in the hind-end). I'm more concerned with the mechanics and what makes a deal a -good- sub2 deal.

Profit split - 50% for funding and 50% for leg-work is fair.

VA Deal won't close - 80k ARV, seller owes 65k, needs conservative 10k in repairs. CA deal still in the works.

Thanks everyone for the redirect back to reality.

Ned Carey Nope, no other issues - I just had my blinders on. There really wasn't an issue except my myopia.

As it turns out, the property comps at $132k w/ average dom of about 36 for sales and 44 for rentals, the guy owes $82k and wants to walk away from closing with $2200 in his pocket (enough to cover two months mortgage that the tenants haven't paid in rent). That makes the floor on the deal about $88k.

I have not seen the interior, but the seller said his sister lives close and could grant access. He also said the tenants keep the place clean but that it probably needs new carpet (pet damage). It's a 2074sf 3-2-2 in a nice area, and I could wholesale it with a tiny assignment fee and almost no repair budget, but the property condition is the last variable I need to fill in.

Michael Wagner I always prep my sellers way ahead of time on anything I know is coming that may spook them. If you warn people most are ok when the "snag" you warned them about comes up. Good pointer though, thanks!

Turns out the deal from CA may be a little thin - exploring other options like a sub2 or a master lease agreement - this guy is only concerned with preserving his credit and making mortgage payments.

Wayne Brooks You're right, I was just making it more complicated than it needed to be. Fedex and notaries - SOP for closing w/ out of state. Property access is the only issue.

Both properties are currently under lease - that's my next hurdle - how to wholesale with a performing lease in place.

John Brackett Thanks for the pointer.

Sending out direct mail to absentee landlords - I decided at the last minute to include out of state as well as in-state. I'm getting more OOS than IS - how do you go about viewing the property just prior to signing paperwork and how do you handle paperwork with an out of state?

I'm comfortable doing in-state where I can do face-to-face and I've closed out of state deals via Fedex before, but I've never worked an out of state end to end.

Limited power of attorney for a designated rep in Houston? Get his/her property mgmt company involved?

I've got two deals on the hook right now, with sellers on opposite ends of the country (Virginia and California).

Credit line vs HML? It's all in the numbers - if the numbers make sense, then I'd consider it.

Content almost always trump design.

.....unless you're prone to slathering those animated "under construction" icons all over the place - in which case I'd tell you to step away from the keyboard and hire a pro.

Spend a year just updating a plain old basic wordpress site with content and you'll gain a much greater understanding.

A picture or three of the house, descriptive info, price and make sure you circle back and mark it as sold so people will stop hassling you about it but definitely don't delete it.

You can set up a blogger account for free - there's a lot less to manage for a beginner...and when you're ready to upgrade to WP - http://www.wpbeginner.com/wp-tutorials/how-to-switch-from-blogger-to-wordpress-without-losing-google-rankings/

*bump* How about an update...