All Forum Posts by: Paul Choate

@Pono Wright The important thing to understand about the transfer of property is that the deed itself is only as good as the legal interest of the person giving it. A deed in and of itself does not create the interest held by the person giving it. So, if the grantor puts an interest in the deed, like mineral interests, it only conveys if they actually have them. Deeds are not like a car title. They are like a chain. Once a link is broken, it is a smaller chain with less rights. 

The message from the title company is confusing. I can not imagine the seller wants to sign a deed conveying mineral rights just because the title company wants to "accommodate" you. If the seller has told you they own the mineral rights and is willing to sign a warrantee deed then they are responsible for defending that claim. If it is a quit claim deed, you are on your own. However, if it is important to you in this deal to get the mineral interests then you need to have someone run the title search for the mineral interest and get title insurance on that portion. Someone out there is doing them in your area and this title company should know who. If not, I would question their competency. 

@Deborah Burian you are right- it is very common for people who still own the mineral interests to list it in a transfer as it is a big deal in Oklahoma. I had a bankruptcy client with one of those small interests (from an inheritance) take it into the bankruptcy with a value of $40 based on what someone had offered them. The trustee took it and sold it for $5000. So hold out hope! I personally don't bother with it on the deeds I create when I am paying $10,000 for a house out here in Shawnee and Seminole. Doesn't mean I don't get the interest if the seller has it. It's just they probably don't have it and it is not worth the cost/time to research it. 

Sorry for the book- Bottom line- the deed you get is not what determines the previous owner's interest (they just created that document!). It does determine your interest. All you can get is 1. what they have AND 2. what they convey to you. When in doubt get an attorney or title insurance involved.

I think most people have learned their lesson in my area. Even with the "boom" of the past few years, there has not been much new development; at least in the smaller towns where I invest East of OKC. We were running over capacity when the pipeline came through, but that has ended now. I actually had to wait a month to rent out my last vacant unit. I guess that is going to become more common.

@Amine E. Nice!

Do you mind sharing how you found it? (DFD, MLS etc?) Was it a foreclosure? Thanks for sharing the pics!

@Michael Cornell yes. That would be my suggestion. You can tap the equity in your home and you are more likely to be approved as an owner occupant. Once you have established a track record with your rental properties, you will be more attractive to lenders for purely commercial loans. I would also search this site for "house hacking" as it is a great way to start. 

People think that bankruptcy is the end of your credit. I think you will find that the opposite is true. Lenders know you have the same income after filing, probably the same assets and you can't file for 8 years. Obviously, you need to shop around and take your time to find a good lender who will treat you fairly. Also, you want to be extra sure that you correct whatever caused the bankruptcy in the first place (if possible- you cant control every thing). 

@Account Closed is right. He provided a better answer to your original question about how long it will take to get a loan for investing. I doubt that you will do very well jumping straight to commercial/rental loans if you have not shown a track record on a personal home loan first. You will also probably get a better rate anyway as an owner occupant. 

That has been my experience at least. I built my first home with cash I had saved, took out a loan on it and then bought my first rental properties. I then put a loan on them to buy more. I have never purchased a rental with financing. I have always financed out the equity for the next one.

I am in Oklahoma and we deal with mineral rights all of the time. Generally, mineral rights are not specifically listed as they are transferred in the language of the deed(i.e. all rights and interests etc) unless the seller specifically reserves them. Around here, most mineral interests were separated from the surface rights years ago because they have so much value by themselves (oil patch). It would be rare that the minerals are still owned by the surface owner in my area. The title search and opinion can tell you if they have been separated. Once again, in my area, most title opinions do not even address the mineral interests because it is assumed they are not being conveyed.  You would have to specifically ask (and pay for) that.

Short answer- if you purchased a property from the owner who had the mineral rights and did not reserve them, then you probably are the owner. You don't have to do anything.

I am a bankruptcy attorney and I regularly have old clients contacting me who are applying for loans and they need proof of their discharge. The FHA guideline is 2 years:

http://portal.hud.gov/hudportal/documents/huddoc?i...

This is from your discharge date and is for a FHA insured loan (a lot of them!). Obviously everyone has their own way of doing things but don't give up with the first no.

www.bluehost.com if you are comfortable with WordPress or willing to learn. I am not very tech savvy but I have managed to create a website with it and it is not too bad at about $4 per month (pre-paid for a year or two).

Welcome! We just started a meetup in okc. Our next meeting is 10/28/2014 at noon in Oklahoma City. Check it out under the network tab and then events and happenings. This place is great for learning all you can. 

@J Scott Thanks, I thought I might be overshooting my target. 

I am beginning to branch out from my personal investments and want to began approaching private lenders about investing with me. I currently have an investor but I think I will max out that source of funds soon and I want to keep growing. I have had multiple contacts over the years with friends of friends and family who may be potential investors. I have not pursued them very well as I did not really need them at the time. Now, I would like to put together a general proposal highlighting what I have done to date, general terms I can offer and currently available properties I am looking at purchasing. I am anticipating this will take the form of a 5-10 page booklet or pdf. 

Question- Is this how I should go about this? Is there anything else I need to include in the packet? I want to be professional but also allow the relationship to develop naturally. I plan to invite them to see my projects or take them out to lunch. I don't plan to "cold call" anyone. I just want to put these out there in my network and let the numbers speak for themselves.

Also, if you are a private lender, can you tell me what your general terms look like? (interest rates, points, term of note, LTV etc.) Just trying to understand what the current market looks like in a big picture sense.

Thanks in advance for your input!