All Forum Posts by: Barbara Grassey

Sherry has a very expensive program to get you grants. Most grants go to non-profit corporations so the first step is to start a non-profit. At an upcharge.

I got a behind-the-scenes earful from a friend who was invited to work with her sales team. Even though he was brought in because of his expert status, he was told not to offer low-priced solutions to people's problems; he was only to recommend that they buy Sherry's program.

Now, if you're hired by a company, you pretty much have to do as you are told or quit. He quit quickly. Last I heard, he was still trying to chase down $500 that she owed him for work he had done for her.

Bottom line, if you don't mind being over-charged, Sherry's program will probably work for you. I just don't like to give money to people who try to hit you for every last dime. There are far less costly alternatives out there.

Barbara

Hey Nick,

Investors are using round robins fairly successfully in our market. They sometimes run them in conjunction with an eBay auction. I have seen them work and not work - but at the very least, you come out with a buyers' list and a very strong idea of what the property is actually worth.

Barbara

I am more concerned with what you are going to do with the property AFTER you purchase it with OPM. Finding good deals in this market is relatively easy. Have you located people who will be your buyers, either investors or end users? Do your buyers have the money to close and get you through the deal?

I am a bird dogger, and I am reversing my strategy: I now find people with REAL MONEY who are actually buying instead of just saying they will buy. Then I find the houses to fit their parameters. Our Florida market is one of the hardest hit markets in the country; maybe yours isn't as slow. But it is a lot easier for us to find great deals, especially REOs, than it is for us to find someone to flip it too. I am concerned about the second part of your deals --- finding a real buyer and getting yourself through the deal.

Barbara
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Can you rent out the property to cover the mortgage or most of the mortgage at this point? If not, could you sell half your upside to an investor for half the monthly PITI? Does your condo association allow you to rent it short term and can you find a property management company that can do vacation rentals which are typically a better return than yearly.

It will be a good five years before values start coming back in Florida but you have a great location. Unfortunately, you have a number of factors working against you even as a short sale. Currently, financing for ANYTHING is tight. Cash or FHA are the only deals that are closing. Also, in Florida, lenders have a closet moratorium on funding condos. Condo associations/developments have to pass a background check for financial stability before they will lend and the check can take up to a year. By then your buyer is long gone.

Since you are retiring, you may want to move in and make it your primary residence. As such, you may qualify for the HOPE re-fi program. If you can't do that, short sale is the way to go. If you can find a buyer, you will either have to bring cash to the table, work out a payment plan with Countrywide or get slapped with a deficiency judgment.

One of the things we are seeing is that lenders won't even talk to you about loan mods until you are three months late. So people stop paying, trash their credit and then have to go countless rounds trying to get a loan mod. Tell them that you can no longer pay (don't stop paying on the mortgage without consulting a lawyer) and you need to get that adjustable rate loan down to a manageable fixed rate.

If the place is empty and you are willing to gamble, offer to send them the keys back with a deed in lieu of foreclosure. They don't really need another condo. That may get their attention. Or at least get your case kicked up to a supervisor. The customer service reps you talk to when you call in are temps or just barely better than temps.

The old-time nvestors won't go near an adjustable rate mortgage. A whole new generation of investors just found out why.

Chin up.

Barbara

Nice to see this thread still going on. I live in the Tampa area where we are old guard guru rich. Jack Miller, John Schaub, Pete Fortunato, Jay. These guys aren't fancy marketers. When they sold a seminar ticket, they spent their time TEACHING you, not upselling you. They still teach at a fraction of the price of these slick marketers who know marketing inside and out and jack about real estate.

If you are encouraged to call your credit card company and raise your limit in order to buy a program, you are getting VERY bad advice, especially in this economy. Hold onto your cash. Learn how to do creative deals. We talk to more people who have spent their money on gurus who turned them onto "investments" which are now upside down and killing them.

Barbara

People in my area are taking an short term option on a property and then marketing it using the auction method. The option gives you an equitable interest in the property and therefore you are able, at least in Florida, to market the property.

Laws probably vary state to state so check with your real estate attorney.

Barbara

Maybe it wasn't specific enough. What kind of contract are you looking for? More importantly, what are you trying to do?

Most people paid good money for their contracts, refined and customized them and then had them vetted by an attorney. Also, handing out contracts can be construed as practicing law without a license, so some people may be a bit gunshy.

Now, all that being said, remember that a contract is merely an agreement between parties. It is a document that changes with every deal. So one size doesn't fit all and a really good contract only fits the specific deal it was built for. On the other hand, a basic purchase and sale agreement is a good starting point. You can go off your state real estate purchase and sales agreement and customize from there. Then have it checked by an attorney to make sure you didn't trip yourself up. I always ask an attorney that in addition to checking it for what is in the document, what should I have put in the document.

Let me know what you are trying to do -- purchase, lease option, master lease, subject to, etc. and I will see if I can come up with some advice that is more specific.

Barbara

Boy, I was looking for a nice way to say that. Good advice, Mike.

One other thing you may look into doing is sandwich leasing properties from people IF you can make enough of a spread to make it worth your while. The value of the house doesn't matter at that point; all that matters is that you can help them cover their payment and still make money. Look for houses that are empty. You don't want to deal with moving people out of their homes.

Also, don't let their problems become your problems. If you can make some money, great. If not, walk away.

Good luck to you,

Barbara

First, you should check with the laws in your state. Florida just passed a subject to law that applies to owner/ occupants, but not to investment properties. Illinois may or may not have passed legislation on this.

Subject tos can be done and depending on your market, they may actually get a little easier to do because conventional financing is drying up and owners are about to realize that they need to supply financing if they are going to get their houses sold.

The most important thing is to NEVER, NEVER, NEVER take an adjustable rate loan subject to. You don't want it and it will kill you.

Ethically speaking, you must make the payments on time. Just because the mortgage is in someone else's name doesn't mean you can run roughshod over their credit. Remember that you are taking on responsibility, even if your name isn't on the line.

Owners may be more willing to wrap a mortgage or do a contract for deed rather than letting you take a property subject to. Don't rule out those options.

Best of luck to you.

Barbara

Hi,
Lease option or seller financing may be your only option -- we are having trouble getting financing for condos in our area because there are so many foreclosures that condo associations are going belly-up. I don't think that is happening in your area, but it may be creeping up on you.

More importantly, seller financing helps your condo stand out from the others and you may be able to squeak out a little more money by offering financing.

5k is a pretty quick rehab. Concentrate on it and get it off your plate. Good luck on your property.

Barbara