All Forum Posts by: Cody L.

 I do private loans on case by case.  Basically it has to be a deal that I'd be willing to buy myself at the amount of the loan.  If that's the case, I view the loan as having little to no risk.  Thus my rates can be low.

And I seller fiance a lot of the properties I own as I can make more from a seller financed note than if I were to get that sales price in cash and put it in the bank.

The 'catch' to properties I'd loan are the loan has to be at least $500k.  The buyer needs to have some skin in the game (unless the purchase price is WAY under market).  And it has to be centrally located (i.e., inside the 610 loop or not far outside.  Again, unless the deal is a slam dunk and large)

Quote from @Deb S.:

Quote from @Account Closed:

Quote from @Deb S.:

Quote from @Account Closed:

Quote from @Deb S.:

Quote from @Nate Marshall:

He has had more than 10 called due. Banks are wise now. They are even discussing this at banking and mortgage conferences. Pace is finished. Prison awaits!!! 

Why are you mentioning prison? Subto is NOT illegal. It is on the HUD statement on line 503. There is no 'crime' committed. The banks MAY call the loan due but it is not illegal to buy a property sub to the existing mortgage.

You are correct, Subto IS legal, when done legally.
Withdrawing money from the bank IS legal too, when done legally.

Are you aware that when done improperly, Subto can lead to charges of Consumer Protection ACT violations, artifices, deception by omission, equity skimming, bank fraud, mortgage fraud, tax evasion and so on. Just say "No, I didn't know that". Well, yes it can.
https://agportal-s3bucket.s3.amazonaws.com/uploadedfiles/Hom...

Now, "charges" doesn't necessarily mean anyone is guilty, but why put yourself in that position? Court ties you up for a year to a year and half with no guarantee of the outcome. (and is no fun.)

I’m here to protect people from making very bad mistakes, as I teach Subto “safely and legally”. It’s up to individuals though, to get serious and learn things properly.

Be safe, know the law, stay legal. There is zero talk of that at the Subto "community" (Bad news interferes with increasing the sales, cuts into the profit margin I suppose).

 So you assume that Pace teaches how to buy a property subto without providing a legal contract with needed addendums? 

If you were in the community, you’d know how ludicrous this sounds. Pace spends tens of thousands of dollars keeping contracts updated for all of us. 
You shouldn’t make assumptions on how the mentorship works. 

You're very funny and I probably wouldn't work with you. You didn't read what I wrote and you are saying things I didn't even say and things I don't believe. In court they call that "false testimony". I would suggest you ask people what they believe, rather than telling them what they believe.

By your focus on the contracts, which I didn't even bring up, I surmise you have no idea what can go wrong after the closing, thus proving my point. Have a nice day.

 Contracts are what makes something done legally or not. You have a nice day as well. 

 Wrong. If you and I sign a contract, and I break our deal, I didn't break the law.  The cops don't come and arrest me.  Sure you have the right to sue for damages but that's it. 

 Prison awaits?  For what?  What law is being broken?  It's a loan violation.   I used to buy via wraps/sub2 all the time when I was starting back in 2008.  Yes, there is some risk.  As long as both parties know the risk it's up to them to act accordingly. 

Dumb question but if they're month to month, why do you need to evict them?  Can't you just not renew their lease?

If they can provide x days notice to terminate the lease, can't you?

 Exactly.  I live in San Diego, invest in Houston.   Live where it's nice to live.  Invest where it's nice to invest. 

FYI if I was in your shoes, I think the best thing to buy right now are some of these NNN retail deals. Stores that have protection against Amazonification.

I have some NNN retail properties in Houston. Small strip center. One of them has a convenience store + barber shop + auto inspection (amazon can't displace those). Another has a scratch-and-dent appliance shop and, lets just say, an adult novelty shop.

Anyway -- neither of them look pretty.  But both are right off the freeway and were 8 caps even when I bought them (a few years ago when banks paid 1% on your $ at best).

You can find 8+ cap NNN retail deals that will be as close to "mailbox money" / passive income as you can get.  Few things to look out for:

1) Make sure the rents they're paying are under market.  You don't want a property that's a high cap rate but if a tenant were to leave, you'd not be able to find someone to pay the same amount

2) Make sure the businesses are something that can't be easily replaced by online

I'm honestly surprised you can still 'get away' with finding such high cap deals.  I'd have thought enough demand would be there to drive down returns.  I'd buy more of them (vs. apartments) but it's just too hard to find big deals like that.  BUt if you have a few hundred grand to put down and can use leverage for the rest -- that's the best bet (IMO)

 I don't think that's the case.  At least not now.  You can't even find $40k/door apartment buildings (even C buildings in C areas).   I just went under contract to buy a pretty busted up place and it's $50k/door and $750 rents. 

I've bought dozens of deals, over 2000 units.   Trust me when I say this:  It's VERY hard to cash flow on single family.  Even in "high" cash flow areas.  At best you sort of trod along and make money from the fact you have only a small % of your own cash in a deal but benefit from appreciation.  Which if you have 10% down, and it appreciates 2% a year, then that's a 20% return against your down payment if the place at least breaks even.

But if you're looking to build any serious amount of cash flow from single family rentals...  It aint gonna happen.  

Do what you need to do to get into multi (5+ unit)

 Ah, no problem.  I talk to him almost every day. 

 The franchise tax has pretty high minimums.  Most people file an annual 'no tax due' report.  Takes 5 min and costs $0