All Forum Posts by: Alexander Zurn

@Ben Pentz Simply put, legally you must. Are you concerned about doing this or just want to be sure you are legally in bounds?

Simply that I knew about real estate earlier and could have started saving earlier.

@Darsh Patel to your immediate question, yes this is common. However, is 1K really what you want? If so, I'd suggest taking 2k off or 1.5k hoping to end at 1k off. 

@Richard Nix M. Caasi you want to be prepared immediately when you find the property to show it to your hard money lender(s). I would start setting it up now. Be ahead of the game, feel organized getting into any deal knowing who you will speak with after you find the deal.

@Kyle Cuppy mine was 38 pages but I expected a bit more detail. It truly varies by inspector and state. I learned to thoroughly go through any sample reports an inspector has on their websites. If you can't find any, ask for it.

I also learned that in some states prices to go with necessary repairs are included in the report and some states they are not. I cannot verify that it is truly a state specific feature but, again, going through sample reports should make it clear what you should expect.

@Kyle Cuppy you're doing exactly what you need to. The more eyes on your team the better. I went through my first inspection a few months ago now and before we started my inspector took me aside and said "I work for you. I will go do my job and speak to as much as I can about this property and if you have any questions along the way do not hesitate to ask."

Your inspector may not say this to you but they are absolutely there working for you. Encourage the others to ask questions as well. You want to leave feeling you spent your money very wisely. It should be a great learning experience.

p.s. have you confirmed that it is alright to bring that many people along during inspection? Not sure if there are rules to that but just wondering.

Good luck!

@Account Closed

1. It depends on how you go about it, what the specific seller is asking for and more importantly, what you both agree to. Typically, in a wholesale deal, the wholesaler uses the end buyers funds to purchase from the seller in a double closing.

Wholesaler uses end buyer funds to close with seller.

Once closed, wholesaler sells property to end buyer and profits on what they agreed to.

It is MUCH more complicated than I simply described it but that is a quick picture.

2. Yes, you can start making contacts and looking at houses but actually getting deals is something that can be very difficult depending on a plethora of factors (area, property type, price, etc.). There are many disclaimers out there to be very careful doing it and to fully understand most if not every aspect of wholesaling before jumping in.

I recommend reading and listing to podcasts about it.

Good luck

@Griffin Taub that really depends on the price range of your area. As I am not from there, it would be tough to speculate. I would guestimate b/w 5-35k for down payment and repairs. Really depending on what the property NEEDS, it could be more.

DC has a great First Time Home Buyer Program that allows you to put as little as 3.5% down (FHA) and even offer a down payment assistance loan. That would be another number you'd have to include in your analysis but if it works it is a great opportunity for first time home buyers to leverage little of their own cash.

A simple google search of DCHFA (D.C. Housing Finance Authority) will lead you to their site and further information.

Good luck

@Lee Nguyen I would recommend running the numbers on each of the situations.

for example:

A. How much would you gain from the sale? How much would you lose to taxes? Figure this number out and use it as a baseline.

B. Take your Net Profit from A. and understand what it would be without taxes. Is it enough for a substantial downpayment on a similar property that the 1031 exchange would require?

C. I like this IF the numbers work. Keep it rented, make sure the HELOC can be paid of with the rent or that you have reserves to continue to pay it off. Use the cash out as a downpayment. Get the EXACT number you could take out and what the pay back numbers would be.

D. Maybe cash out refi the condo on a regular conventional loan? Free up another VA eligible loan and leverage your money. Make sure the rent covers the new loan, etc.

I think, with everything involving real estate it comes down to the numbers. What can you use to be best of your ability. It may not be the highest amount but it will be the smartest amount.

Good luck

@Roger O. this is a popular strategy everywhere nowadays and even more so in your market! You'll have to be on top it every day.

From you've described, both options 1 and 2 are great. You should search anywhere and everywhere to find an experienced loan officer that can provide you ample knowledge and a competitive rate. FHA allows you to put the least down (3.5%) but you'll pay for mortgage insurance (simply an extra expense). Conventional allows you to put 5% down.

I would suggest looking into Californias First Time Homebuyer Program. Most states offer these programs for their residents to purchase housing with little to no money down. Some even offer downpayment assistance amortizing loans, some even have GRANT's that you don't have to pay back. My state used to have a Grad Grant that was assumable after 5 years (meaning no repayment) and to qualify you simply had to have graduated college in the past 36 months (3 years). Not sure what California has to offer but a simple google search should suffice. Also, be sure to ask your loan officer about it.

Good luck!