All Forum Posts by: David M.

@Stephen Dispensa

Oh I understand your point... Just trying to clarify I thought the MLS' required it. For example, just having a real estate license isn't sufficient to gain membership to a MLS, which I believe most are owned by commercial third parties...

As for our local boards... telling them to withdraw from NAR is like a catch-22 since they are all NAR subchapters I thought... It'd be a complete fragmentation of the trade association. Meanwhile, many agents work across board/MLS boundaries. So having different rules or customary practices I would expect get hectic.

As for what NAR offers.. I don't have much to comment...

@Stephen Dispensa actually, I think the MLS' that require NAR membership... Maybe it varies...

just to add to that.. take a look at your tax return and see how much PAL (Passive Activity/Allowed Losses) you have built up.  They will help offset your tax liability.  For whatever reason, its not talked about enough.

Also, checkout my post here of an actual example of where its cheaper to sell, then try to cash out refi:  https://www.biggerpockets.com/forums/48/topics/1169308-equity-rich-need-advice?highlight_post=6659747&page=1#p6659747

As @Christie Gahan said, paying tax isn't bad.  Being spiteful about paying taxes can be very bad.  For the tax you pay, you just need to be doing it efficiently.

Good luck.

@Henry Sims seller financing would have only spreadout that tax liability.  If he paid 6 figures in tax, good for him:  he made a lot of money then.  He can take the proceeds and reinvest.

@Alecia Loveless

Yeah, that's a good point...  I think the ruling "doesn't disallow" the current practice, its just trying to open up to different practices. Makes sense since Redfin's model is different. There was a company that didn't offer any split, but that died off.

We MIGHT get more variable commission structures, such as 4% + 2.5% to the buyer or if the listing agent brings the buyer its 5%. Incentizes the listing agent to find a buyer and the seller to accept it.

If buyers will have to price match/comparison shop between the different fees, it just becomes a small nightmare for them. Not to mention, you have to ask each listing for it since it will no longer allowed to be shown on the public listing.

@Carlos Ptriawan

Yeah, guess it also depends given that some states don't allow dual agency.  Maybe the buyer is just unrepresented ...  that's sort of what it was like with sub-agents before there were buyer's agents.

Or like in commercial, the commission is as variable structures such as 4% + 2.5% to the buyer or if the listing agent brings the buyer its 5%.  Incentizes the listing agent to find a buyer and the seller to accept it.

I think on a different thread, it was mentioned that agents will just go about it "business as usual."  I think the ruling "doesn't disallow" the current practice, its just trying to open up to different practices.  Makes sense since Redfin's model is different.  There was a company that didn't offer any split, but that died off.  

I think reasons for buyer's agent to is make the showings and help people through the transaction.  Most listing agents don't want to do showings.  Only experienced investors, at best, can handle a transaction themselves in a particular market.  In states w/o attorneys, pretty much only the agent is there to help "arbitrate" to get the deal to closing.  Sure, in attorney states the attorney can screw it up too, but so can the agent.  I just see it as having two chances of having a successful avenue of communication :)

If buyers will have to price match/comparison shop between the different fees, it just becomes a small nightmare for them.  Not to mention, you have to ask each listing for it since it will no longer allowed to be shown on the public listing.

@Jason P. Of course, its your property.

Are you looking to resell the Note?  A couple years ago the rate was at least double digits.  Also, make sure to do all paperwork, underwriting, especially the Federal docs if you plan to resell the Note (well, legally you have to do it anyway).

Good luck

@Joseph O'Sullivan

You what comes to mind...  I would use it for a short term loan to yourself.  Maybe if you were doing a reno, or the brrr.  get the tsp loan after purchase (so its easier to qualify for the loan).  But, have an exit strategy to pay it back/off quickly.

Its still risky, but I think better than using it as part of your money down....

@Joseph O'Sullivan

Its a matter of opportunity cost...  You realize that if you were in the C fund last year, you'd be up ~27%?  Yes, the market goes up and down (and that example is one fantastic year, although we've had a lot of them)...  I know this is a real estate forum, but just realize that you'd have missed that AND lost 5% since you have to pay yourself the G fund rate, vs. the G fund paying you.

I'm not anti-real estate, but I don't prefer it when people take extra risks with their retirement.  You can still lose money in real estate.  Look at any graph youwant, but just realize what really matters is what your "ONE" property is worth.

5yr term isn't bad, but you need to have a solid plan to get that paid back.

brrr is a great strategy, however, its difficult to pull off 100%.  We had a long thread about that a while back, before rates shot up.  So, it'll be even harder now.  Lets face it, a brrr is basically a flip you don't sell.  Who really thinks making a profit on a flip isn't risky??

Don't forget that the tsp repayment will be counted against your DTI when looking at conforming loans.

Otherwise, it seems like you understand the risks.  Its up to your investing strategy and goals.  Depends on how you want to look at it:  opportunity cost?  diversification?  education?

Hope this helps. Happy to chat.  Good luck.

@Jason P.

Do you have a "someone else" in mind?  It great to "pay it forward, pay it back," but try to make it financial sense.

I guess how much work does it need?  You willing to perhaps loan on the reno as well?  I am guessing not it if you need the cash to do another deal.

Somebody else, investor or not (albeit, any owner of a 2family is automatically an investor), can get a FHA 203k or conventional reno loan at 3.5% or 5% down at ~7%. Is your market that weak there? My market is really strong, so there are plenty of qualified buyers.

Certainly, you can do whatever you want with your property.  Just realize that what you are asking isn't necessarily competitive with the "qualified" buyer market.  Now you are restricting yourself to the "unqualified," for lack of better term, market.

Otherwise, yes stay with at least 20% down.  That was developed by the banks decades ago since if they needed to foreclose they would at least break even...  As for the rate, it really depends on what sort of buyer you are looking to solicit.

Good luck.