All Forum Posts by: JR T.

Sorry paperwork reflecting the work that was done. I'm not a painter. The product they're using is called Insl-X which is sold in paint cans and applied like paint but is described as a "lead encapsulating coating." It's supposedly highly durable and has a bitter taste so kids won't eat it if it comes off, but I don't see how it could make anything lead free if they need to add a bitter taste to it.

@Ned Carey Lead-safe is the procedure I described above where the landlord gets a lead inspection performed at each tenant turnover. Are you saying if my people used the encapsulation paint prior to regular repainting my property could possibly test lead-free? I'm not there for the painting, but it's an interesting idea. The reason I'm confused is our paperwork for painting in pre 78 homes reads "encapsulate paint xyz rooms"

I'm not certain lead-free is always best. If the home still contains lead paint that's had a layer of encapsulation paint added couldn't lead be detected at the property again at some point in the future? Especially when doing repairs or improvements? I've read court cases where landlords thought they were lead free and then had an instance of lead poisoning. 

Thanks for updating me on the nomenclature.

I would want an accountant familiar who works with Maryland tax law every day. An out of state accountant might get your books in OK shape but you'll lose a lot of strategies you get in a normal relationship that adds value beyond filing taxes.

@Brian costanzo

You can call the signs. Any deals as you get being new to a wholesaler e-mail list will not be stellar. Another rub is wholesalers are very unsophisticated players in the market so the deals you do get will have issues/problems/etc. that you will have to solve if you want to close the deal.

The wholesalers who have a more sophisticated business structure will keep the good deals for themselves and resell the deals that are near market once the wholesaler's markup is added. So while they have deal flow, the deals won't be for you and will waste your time.  

If you want deals 30% off ARV you'll need to have funding ready and start your own marketing program to find someone ready to ditch their house quickly. I suggest you go into the District Court and ask to inspect the eviction filings. Look up the property owners, try to call, write, go knock on their door if you have to.

1) The first thing you should have learned when researching wholesaling is that few of the people behind the signs actually buy property. What you need to find cash buyers are good deals. Finding a cash buyer is simple if you have a deal that's 20% or more below market.

2) No, but it helps. You're going to find that you do a lot of marketing to generate a paltry number of leads. Then of those leads most will not go anywhere because there isn't enough money in the deal for you the homeowner and a cash buyer who will deal with you or you get a seller with a brain who isn't gonna go for the deal you need to get the cash buyer.

3) I'd suggest if its your business practice to back out of contracts you can't find a third party buyer for you specify that in the contract. Otherwise, you could one day owe a seller a bunch of money or in a situation with the FTC or Attorney General.

4) I don't know why you'd need to. You will definitely be able to tell the sellers from the buyers. Get a google voice number for free that rings through to your cell phone.

What you need to do immediately prior to any lead inspection is CLEAN.

In an old property like that it would cost a fortune to remove all of the lead paint from the walls. So the other option is to "encapsulate" it (which means paint over it completely with clean new paint -- no chips or cracks) and then you clean up all the dust. 

Considering the situation with dust I'd get a crew out there to soap down every surface once you finish construction work and encapsulation and then scrub the window sills and floors a second time the morning of the inspection. You can't see lead dust so assume it's on everything even stuff that looks new and clean. 

You will get a new $150 inspection every tenant turnover but this is pocket change compared to the cost of making a 100-year-old home lead free.

@Christopher Phillips Just as a note in Maryland the tax sale certificate conveys no right of possession to the winning bidder. Also, the owners can redeem at any time up until the Circuit Court renders judgment foreclosing the right of redemption. 

Just posting so nobody gets a tax sale certificate over the counter in Baltimore and tries to go change the locks. Could be a bad situation.

I recently went through a very similar deal. In my case, the owner of the tax sale certificate had recently obtained judgment against the deceased owner but was unaware their defendant was dead. 

I contacted the attorney for the owners of the tax certificate and purchased their certificate and an assignment of the lawsuit they had going. Once the tax sale certificate was reissued in our name we became the unopened estate's largest creditor and for that reason we were able to open the estate. We had the prior judgment vacated, substituted ourselves as Plaintiff, I hired a separate lawyer to open the estate, be the PR, etc. We served the lawsuit to foreclose redemption on the estate and 10 short months later received the deed to the property. 

The people you're trying to make a deal with won't be able to transfer the property if they don't open the estate. You should research the high bid premium to see what they're expecting to get from the tax sale process. Many large tax lien buyers are in it for the interest rate play, the last thing they want is to actually get a piece of real estate. They're not going to take a haircut for you, but you can get it very close to what they paid, their legal fees and all accrued interest.

The high bid premium is a circuit breaker to make sure the tax sale process rewards investors and penalized tax scofflaws, but stops short of the taxpayer being robbed of their property. If you look at the tax sale results you may have to find your winning bidder, their bidder code and then in the results its expressed as BidderCode and BidFactor. Multiply the bid factor by the assessed value in SDAT and that's the high bid premium. You pay that to the county after foreclosing the right of redemption and in your case it will get paid into the estate and distributed to its heirs.

What Russell said. The bank does not want you to sell or lease it back to the owner after they took a big haircut on the loan. Bankers see that as the ultimate moral hazard cause you'll tell your family, tell your neighbors and ultimately will provide that little nugget of encouragement to get another consumer to try default. 

REO I've purchased have contained addenda limiting resale for six months or sending all or a portion of any profit made to the bank.

Try Bank of Charles Town.