All Forum Posts by: Alex Folchi

Questions at this time mostly around LLC, family trust, etc. but hoping to find somebody we can set up a long term relationship with.

Hello!

My wife and I are relatively new in RE investing and looking for a RE lawyer to run questions by.  Any recommendations for a lawyer familiar with California real estate, especially these counties: Plumas, Sierra, Napa, Santa Clara.

Thanks!

@Blaine Alger Seller Finance the entire property. I apologize if I used confusing terminology. I can see now the difference between the two.

@Blaine Alger thank you! Really appreciate the response. I did not mention above, but the seller is offering 4% interest at 15% down with a 5 year balloon. The more I look into and learn about this, the more this seems like a perfect fit for my scenario.

@David Robinson happy to connect! I’ll DM

@Joseph Firmin thank you! Really appreciate the advice.

Looking to purchase my second investment property.  I am likely $10-20k short in the necessary down payment for a deal that recently came to me.  The deal checks all the boxes for me (area I like, area I know I can find renters, small multi family-3 units, near my first purchase, cashflows with all 3 units rented, breaks even if just two are, etc.)  While I am saving quite a bit on a monthly basis, I do not want to wait months until I save the rest because I am worried the deal will sell elsewhere.  Pre-approval is in hand, pending the down payment.

I am considering asking seller to consider Seller Carry Financing as the agent believes it may be an option.  I have obviously never done this before, and I wonder what the draw backs for me as the buyer are?  What should be part of my negotiations tactics with respect to rate, balloon payment timeframe and date, etc.?  Am I able to simply refinance in a few years when the balloon payment is due?  Obviously some risk in rates rising over that time, but that risk seems small to me.  What am I missing?

Buy-and-Hold investor. Credit 780+. Able to save decent amount each month just from W2 job.

@Mark Faustrum @Joe Splitrock

Thank you both for your detailed responses.  Limiting the risk by holding a substantial deposit in escrow until she does in fact vacate is great advice.  I am honestly not sure I will even go this route at all, but if I do, I have already started preliminary conversations with my attorney about this process.

I especially hear you about CA specific concerns.  I have heard similar stories (not about sellers staying as tenants specifically, but horror stories for tenants in general), and this additional risk worries me.  Really appreciate the help.

@Mitch Messer

I really appreciate the depth and honesty! These are the types of red flags going through my head honestly.

A bit more context to this specific situation:

All communication has gone through our agents, and she does not have my contact info.

My agent has told me the seller wants to retire “soon,” but not “now.” She wants sell “now” so that she can buy an RV and get ready to travel, etc. when she is ready to retire, that being maybe next summer.

I still appreciate the sentiment though. You spell out my concerns well.

Should I go this route, I will really need to hone in on the inspection process to identify existing issues. Maybe I can even leverage those issues to get fixed prior to sale. It definitely is an older property, but is in probably “B to B+” shape for the town. I would also need to review the lease with her carefully so that late payments, ownership of damage, etc. is clear.

Thanks again for the detailed response.

@James Carlson

That makes a lot of sense. Treat like a normal tenant and do not give any favors. Collect security deposit like normal. Currently, she gives off the vibe that she will be very open and communicative.. but obviously she is trying get me to buy her property!

Really appreciate the insight. I’ll stick to the systems I plan to set in place for any other tenant.