All Forum Posts by: Dan Bee

So here's the deal on the L.A. Tax Deed Sale. I've been to this before.

There are many properties offered in the original listing of properties to be bid on. However, the property owners do have time to pay their taxes (a couple of days?) before the auction takes place. The actual properties that will go up for auction will be less than the original posted list of properties for auction. Some of these owners pay their taxes late because it's lucrative for them to have the cash on hand until they are at the last straw. Others can't pay their taxes and don't want to lose their property. Savvy investors work out deals with those property owners before the deed goes to the auction block. For instance, if I see xyz property that I like and I do some research and find out who the owner is and how to contact that owner, I might be able to work out a deal with the property owner to pay off their taxes and then buy the property from them at potentially a discounted price. I've never done this but others have told me about this approach.

Do your research before hand. It's a lot of work. Set a bid max for yourself. You don't need to win any bids if the price goes over your threshold. There are so many people competing to try to get the same quality property that the bidding can go higher than your threshold.

Beware of plots of land that are on hillsides. Unless you intend to get a contractor to build on the hillside, you're not necessarily going to find buyers.

Make sure you have a money order in the amount of what your max bidding will be + extra.

Overall, in L.A. County, your competition will be commensurate with the # of properties up for auction.

Can't sell it right away because then my MIL wouldn't sell it to us. She'd only sell it to us if we keep it in the family. She says that after she dies, if we need to sell, than we do what we have to do. The 30 yrs hold is a strong guideline rather than firm legal language.

One more thing . . . the house was built in 1927, if that matters.

I'm not sure if I put this topic in the wrong thread.

https://www.biggerpockets.com/forums/311/topics/344911-the-house-next-door

You mentioned 20+ investors. Where did you find these investors? Are they family/friends or are they professional/full time investors, etc?

Hi BPers,

There's a house my wife and I want to purchase. The house is located in L.A. and it's the house next door to my mother in law's house. This house next door is owned by a trust which includes my wife's mother and her sisters. My mother in law ("MIL") intends to buy out her sisters. She will do this by refinancing her house. How my mother in law does this is less important to me than what my wife and I do.

My wife intends to buy the house from the trust (with her mother as the sole benificiary) will put a downpayment of $100k and $600k will be financed by her mother with interest (rate will be same as refinancing rate - range between 3.5%-4.5% (probably closer to 4.5% to be conservative) for 30 years). The house is probably worth $1.2 MM now. The difference between worth and sales price will be gifted by my MIL - even if it doesn't make sense - I've explained this to her.

Our payments with taxes (Mother-Daughter exclusion from a new assessment), insurance, maintenance, and utilities come out to roughly $3,700. Since we're in Los Angeles, California, we can get a renter in a closed off room in the back for about $1k. This is very tight on our monthly budget and we'll definitely have to be even more conservative than we are now at with our income.

Real Estate Agents and Mortgage Brokers that we know (who don't have a financial interest have said this is a great deal. I'm not entirely convinced on whether this is a good deal or a bad deal. I think we need to ensure that the agreement is in our favor (which we have some latitude since this is family). Legally and tax-wise, I think we've thought a lot of things through.

We are buying at $1.3 MM with interest, taxes, utilities, etc and on sale in 30 years, more than likely $1.5 MM from a sale. Thoughts on the #'s aspect, legal, taxes, etc would be helpful. Thanks BPers.

The problem with NFCU is that they won't lend VA for a quad.

I'm looking for a good mortgage broker that has experience working with VA Loans who is in or near the Northridge area.

I'm looking for a good mortgage broker that has experience working with VA Loans who is in or near the Northridge area.

What is your take on the Lancaster market? I understand there is a retiring community there. What is the best types of properties to buy out there? I don't have much capital though.

Is it a good idea to flip already flipped houses? How can I buy off-market properties that can be reonvated and flipped easily in Lancaster, CA? Do I just send mail to all the city residents telling them that I want to buy? How do I get a list of owners for all the properties there?