All Forum Posts by: Daniel Adams

Hi @Steven Gesis. Thanks. I think we need to wait a few days and ill allow my HUD consultant to reach out to them and see if we can work something out.

I wasn't managing the project by any choice of mine. I told the contractor I wanted to do work (painting, demo) and received no assistance throughout the project. I think he thought the sub would be more involved but everyone seemed to of lost touch with the budget throughout the process. For me, I was left in the dark until the bills came so that part is frustrating and wish there was a way we could have removed items or shopped quotes to get better prices. I have people looking at the case and documents. 

The 203K process is great but you need to be careful to pick a good contractor and ensure that the project is being managed well and everyone understands the agreements in the contract.

contingency*  

lien*

@Wayne Brooks

Talking about work within the contract. The only thing we requested outside of the contract was all new interior doors which we provided consideration for with the painting money being signed over to him. No contingecy money has been released yet. 

Great idea to have the sub sign a lein release. If we ever let this contractor finish the work this document would be a must as well.

Thank you to you both! @Wayne Brooks @Steven Gesis 

You are both 100% right and confirmed my thoughts. The only thing that we have even signed for our the kitchen cabinets and they cost $6,200 and we budgeted $12,000. Hopefully they still deliver them!

He has threatened to file a lien. Great advice to let him know there are penalties for filing false liens. He has literally only showed up for inspection draws and to pick up the check. I did a walk through with the contractors to let them know what work was being requested but again nothing was signed and the invoice was received after the fact. I even told him that if we discussed the cost and got quotes we would want to adjust to stay within the amount allotted. I handled the plumber work and stayed under budget easy. 

We are hoping to terminate him and finish work with another contractor before the lien goes through. Its amazing. This program also outlines that if it costs more then outlined after we have to fire him that he would have to pay for those extras as long as they are within scope. 

Very frustrating to have to go through. If he wanted to get paid and cover his profit overhead etc he needed to be at the project managing every aspect. He cant even justify asking for 18K in profit for the amount of work he has put in.

I feel bad for the sub though. Guy is stand up and has been nothing short of amazing. He has gotten $6,500 of the 40K we have released. That part bugs me the most.

Hi All,

Wanting to see if there is any advice for a situation that I am going through. I closed on a 203(k) loan on January 4th. My wife and I thought we had a decent contractor and the work was slow but it was progress. Throughout the process he continued to go over budget and we tried to help with giving him some allotments early and signing over a 3K decorating budget which was for painting, something i planned to do. 

We are almost done the project and he gets his attorney to send me a letter asking for 20K for overages. I have not accepted or signed for any of these overages. Long story short, he is threatening to go to court to seek the money. Very frustrating because we are so close and he hasn't once been at the project to manage it, only to collect the check and be at the inspections. He subbed out the work.

The main overage was electrical work which went almost 4K over budget. I was not told before or during the work that it would be in such excess. He went with a friend to do the work and did not try to bid out the requirement or ask that we reduce some of the requests. There is no way I can be legally liable for those charges I did not sign off on or approve me done.

I know we are protected by HUD, our consultant, and the contract but he doesn't seem to get that.

Any thoughts?

Hello everyone,

I am looking to put an offer on a home in Annapolis MD. It was previously in auction phase but did not sell. I can not find the price that it was posted at auction anywhere. I called homesearch and haven't had any luck and my agent hasn't had luck either.

Can anyone help!?

Thanks

Thanks for the advice @Ron S. and @Russell Brazil

I just heard back from the zoning and permitting folks who said it would be impossible unless I lived there which I don't plan on doing. Frustrating but good to learn. 

@Russell Brazil it is in AA and they hated the garage apartment as well. 

BTW Upen had great things to say about you!

Looking for some quick advice.

I have found a property that is a triplex. This property is priced well and with a large rehab budget would create an income stream of nearly $550 a month on the conservative side.

BUT, there is a few issues.

-The property has only 1 zoning permit. I would need 3 to rent out all of the units to separate tenants.

-The additions put on the property (in-law suite and garage apartment) were not permitted or inspected. My contractor is extremely nervous that this may cause a ton of hidden cost. He worked with a property were they made them remove the structure and start over with the addition. Not something I want to do or can afford. 

Has anyone been in this situation before? I am working with the local zoning and permitting committee first to see if I can gain another permit.

@Wayne Brooks My goal isn't really to live for free it is just to make a profit at the end of the flip and trying to get to a solid purchase price using the calculator. Not sure where you are getting the $178K from. As noted above, the purchase price for the desired profit isn't something that the seller would accept.

All,

Quick question. 

I plan to purchase a live in flip via a 203K loan here shortly. I am trying to maximize the use of the house flipping calculator to determine the purchase price. I insert 720 days (2 years) and it comes out to a low number the seller isn't going to accept.

How do I account for the value of my mortgage payments throughout those 2 years? Do I look at the return on Investment for flip? Or try to calculate a value for refinancing down the road?

Thanks so much!

For example purposes:

After repair value: $300,000

Rehab: $20,000

Profit: $50,000

Purchase Price: $158,000.

MLS listing/asking price: $239,900