All Forum Posts by: Chris Soignier

You could easily get market value for it - that's the value of it in whatever condition it's in at time of sale. Why not get a home equity line of credit, and use those funds for the rehab and building of the extension? You can then pay off the HELOC when you sell the condo.

Try Home Depot, Office Depot, and other retailers that want to lend you money that you'll spend in their store.   Often they're quicker to approve b/c they're motivated to use credit as a tool to increase sales.

W/ banks, usually your LLC will have to have a good, established credit history, or you'll need to personally guarantee the debt w/ our own solid credit rating.

Call Paul Peebles @ Old Capital in Colleyville, TX.   They're MF financing specialists, and can usually broker as good of a deal as anyone.    

Too far off the tax appraisal? I wouldn't worry about that, it's pretty much irrelevant since TX is a non-disclosure state and the appraisers can't keep up w/ the rapid movement in pricing. If you want a second CMA, let me know.

1.   The addendums are created to meet the needs of all types of situations, so there's no "one size fits all" answer.    Best bet it to read all the addendums mentioned referenced in the TREC 1-4 unit contract, and be aware of certain others such as the septic system disclosure.

2.  Read any contract you're a party to thoroughly.   If you don't understand it, get help from an attorney or other competent party.   You have an aversion to using agents, yet this is an area where agents can add a lot of value.

3. It's a balance between striking while the iron is hot vs. wasting a lot of time on contracts which won't ever come to fruition.   Bringing a computer w/ an electronic signature system is a nice middle ground.

I'd love for someone to pay for me to live in a $900K house in Santa Barbara too....who wouldn't?

Depending on their age, a reverse mortgage may just be the solution to their problem.   It sounds like they have unrealistic wants and can't accept the reality of champagne dreams on a beer budget.  

I think you need to pick an approach that fits your personality. I love going to REIA meetings to network, learn, and meet interesting people. Some of the more aggressive folks at these meetings turn me off, so I don't want to be one of those people. I introduce myself, and it will usually come out that I'm an investor and realtor. Most of my investor clients have come from a combination of people liking me and/or demonstrated proficiency in what they want to invest in. Build relationships, and business should arise from them. I know, many agent coaches would argue that's way too passive an approach. Then again, I got my license to augment my investing business, not to become a top producer.

I would just create a separate LLC and move the property into it. That will be the cleanest way to split the cash flows evenly, and would be necessary for him to take his share of depreciation expense. Otherwise, you can't buy him out of something he doesn't own!

@Will R., just to be clear, I've only done one  SF deal so far.   I'm actively working to raise private money to fund acquisitions of seller financeable properties so I can focus on it as my primary strategy going forward.

I did and will put the deal together, as that's much of what creates the value, and I'm focused on middle/working class neighborhoods in North Texas/DFW area.

I'd love to buy w/ sub to's and seller finance, but those are hard to find these days, so I'm just looking to acquire w/ private money.    I can't really provide a normal spread - the market dictates the sales price, and the motivation of the seller, your negotiation skills, competition, etc. all influence the purchase price.

Mitch Stephen is one of the country's leading experts on seller finance, and he lives right down the road from you in Canyon Lake.    He's a great guy, and if you're interested in seller finance he'll teach you all you need to know.   In fact, his upcoming book is an awesome read on seller financing - I highly recommend reading it if you want to learn all the nuances of this technique from a master of it.

@Will R., basically it comes down to different strokes for different folks. Buy and hold is an excellent vehicle to create long-term wealth. I'm a passive in many apartment complexes, soon to be a couple more, and have one SFR rental which is quite honestly too valuable to achieve optimal rental economics. ($350+K market value, 2250/mo. rent)

It seems like many of your concerns or fears are born out of not having a lot of knowledge of seller financing...which is OK, all you need to know really well is the strategy (or strategies) you employ.

I didn't force appreciation at all in my example.   In fact, my buyer's closing was completed before my seller's closing.   I didn't do a thing to the property, didn't buy title or property insurance, and didn't pay any prorations.    Seller financed deals are generally priced based on rent comps, not sales comps, and usually command a higher price vs. an otherwise comparable property w/o financing.   The risk was amply covered by the 10% down payment and 9.9% interest rate.   If I have to foreclose or negotiate deed in lieu of foreclosure, I'll sell it for more next time and collect a bigger down payment => even better economics.   (note that I'm expecting to receive payment for a note which matured in Dec. this Friday.   I could have foreclosed, but chose not to since that's not my goal and I was comfortable that it would be refinanced).

Servicing IMO is easy - b/c I don't do it. The servicer receives payment, manages escrow pmts. in and out, provides reporting, sends my payment to my Roth IRA custodian, and takes care of compliance issues. Also, they PAY THE INSURANCE PREMIUMS out of escrow, so the borrower doesn't really have much of an opportunity to skip paying it unless they want to default on the mortgage.

Again, I'm not trying to debate which investment strategy is better, these are just some of the reasons I prefer seller finance for my single family investing.   I'll continue to invest in MF rentals.