All Forum Posts by: Birtha Wall

Hey BP Community!!!

Does anyone have advice for moving from a Vendor Take Back mortgage to a bank?

I just closed my first Multi-family deal! I got a duplex at below market value, 100% seller-financed. The seller and I agreed on 2 years of interest only payments, and then I will need to pay out the mortgage in full. We are both open to re-visiting those terms at the 2yr mark (i.e. continue with interest+principal payments to the seller, no bank).

It is only smart though to plan as if I will be doing the re-fi through the bank. I've never done that before, what do I need to know and what do I need to prepare for?

Hey @Cole Black,

Welcome to BP and Real Estate! I am just in my beginning phases as well! It is tough with how pricey real estate is here, but definitely not impossible. 2% is great, but the 1% is also okay. Read this article here, I found it helpful when I was trying to understand everything. 

https://affordanything.com/one-percent-rule-gross-rent-multiplier/

I would love to attend this virtual event, however my local ONREIA meets that evening, will there be a recording of this available afterwards?

I am in my 2nd live in flip, and so my financial resources aren't available until the renovations are complete and we can get a HELOC. So I have been trying to get creative.

I found a home (not on the MLS) and it is $40,000 (yes that is what is thought too). The catch is, the homeowners want to keep the property, and want the buyer to arrange and pay for the cost of getting a company to move the house. I looked around and found a lovely country lot that is very reasonably priced at $95,000, services at the road. And this lot has the zoning to be severed. If the lot was severed, and one sold, it could pay for the cost of building a basement foundation on the 2nd lot (Even the severed lot could likely get $70k-80k in this area). The lot would still need septic, and the house looks like it would need some new windows, and maybe new or painted siding, but otherwise is quite nice. I have a family friend that did this with their property, and other than a few minor hairline cracks in the drywall, it was totally fine.

I am just researching at this point, but am I crazy for considering this? A 3bdrm/2bath on a country lot in my area is going for an average of $300-$350k. 

Costs: $40,000 (house), $95,000 (lot), $45,000 (moving estimate + permits), $60,000 (foundation estimate), $7,500 (septic estimate), $2,000 (windows at contractor price, we install), $10,000 (optional - finishing the basement, we do the work) = $327,000 Initial Costs. 

-$80,000 (selling severed lot) =$247,000 (total costs after selling lot)  and a sale price of $325,000 (Estimated)

=$78,000 profit (estimate)

This is rough math, so please point out anything glaringly obvious, I would offer well below asking for both home and lot and anticipate counter offers. But am I crazy? Has anyone ever done this? What are the financing options for a lot? I would be willing to approach a private lender about this since it is lower risk.

Does a house that needs to be moved have different financing options than a regular house would? 

Thank you to everyone that responded to my post, it was incredibly helpful! I heard back from a few mortgage brokers, and I got the answer I expected: "sorry but no" due to a combo of a higher risk property, and no down payment or repair costs saved up. However there is a lot of opportunity here for a recon mission. What can be learned, what experience can be gained, what relationships can be built.  

I have a few people that I have a good relationship with, that also have real estate interests/experience that I can approach to see if they are interested in a joint venture. They provide the funds, I manage the flip/paperwork/tenants/etc., they get their principle + interest back when we re-finance. Being realistic, there is very little chance that I end up with this deal in the end, but I can use this as a practice run, and hey, if we get the property in the end, it would just be the cherry on top. 

Any advice from someone that has experience with a joint venture? What are the pros & cons? What are signs that things are going well/not so well? What are the ground rules? 

@Brian Ellis

The interior has not been touched cosmetically. I fixed the support in the attic, did vapour barrier and spray foam insulation in the crawl space. We also built a 17x20 detached garage/workshop. I'm not confident that we have added enough value to be able to pull she equity money out. 

Hey there BiggerPockets Members in Ontario Canada!

I am looking on financing advice.

I am currently in my 2nd live in flip deal, and  only have experience with standard financing (personal money or the down payment, and a bank for the mortgage).  

Ideally I would have like to get into my 3rd deal using a Home Equity Line of my current property; the issue is that we are in the midst of renovations that will not be complete for another few months, and an attractive deal has popped up. This means that I can't borrow against my house, and do not have sufficient savings for a down payment. 

What are the best financing options to purchase a property in this situation? It is a duplex that will require about $45,000 in rehab costs, and take an estimated 2 months to rehab. 

@Ming Lim - thanks for the advice Ming!

@Yannes Chiang - Thank you for the great advice! How would you weigh the importance of business cards for someone who is just starting out? I have mulled this over for quite a bit, but had originally decided to wait on the cards as I have no 'business name' yet. My current email address is my first name and my maiden name, so nothing juvenile, but would it be best to create a new email, something with 'real estate' in it? Would love some feedback! I can order some within a few hours from a local print shop here.

Hey there!

I will be attending my first REIA this week in London, Ontario.

Does anyone have advice on how to become effectively integrated into a REIA? What are the unspoken 'do' & 'do not' expectations in these groups?

For seasoned members - what were some positive and negative things that stood out to you from new members in your groups?