All Forum Posts by: Daniel Mendez

 Yes, you always file the deed for several reasons. Escrow will do that for you. The deed gets filed with the county the property is in (City doesn't have anything to do with it). If you contact the bank they WILL call the loan. You have no reason, legal or otherwise that you need to involve the bank. You do have to have a way to pay off the loan quickly (30 to 60 days) in the event they do call the loan.If you start missing payments they will call the loan. Don't miss payments, it's bad form. ;-)

I do teach how to do creative financing, subject to, wraps, land contracts and how to find "off market" deals. But it ain't cheap. ; -)

 I always use Subject To if the seller will go for it. I use a Wrap if they won't go for Subject To or if they plan on buying another house in the next couple of years.

Here is a Subject That I've done:

https://www.biggerpockets.com/forums/311/topics/780022-3-ways-to-wealth-in-real-estate-cashflow-flip-hold-here-s-how

Investment Info:

Single-family residence buy & hold investment in Huntsville.

Purchase price: $85,000
Cash invested: $85,000
Sale price: $140,000

This is a BRRR outside of Huntsville, which I obtained through my awesome broker there. I am expecting this to be my best BRRR ever in terms of cash flow and hopefully infinite returns.

What made you interested in investing in this type of deal?

My main interest in this deal was the neighborhood it is in. It has very good rents.

How did you find this deal and how did you negotiate it?

Through my awesome agent. We offered cash and a quick closing.

How did you finance this deal?

Hard money- in progress. Will let everyone know how this goes/

How did you add value to the deal?

Rehab- TBD

What was the outcome?

TBD

Lessons learned? Challenges?

Plan for more down up front.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I recommend John White to anyone investing in the Huntsville area. He's awesome.

Investment Info:

Single-family residence buy & hold investment in Huntsville.

Purchase price: $245,000
Cash invested: $79,000

Attractive B class property within 1 mile of HSV medical district.

What made you interested in investing in this type of deal?

Long term hold for (fingers crossed) equity gain along with good cash flow.

How did you find this deal and how did you negotiate it?

Zillow. It had been sitting for 6 months. Negotiated them down $30,000 from asking price.

How did you finance this deal?

Small local bank.

How did you add value to the deal?

Yes, put $34,000 into a new HVAC, Paint, Lighting, Tree Removal, and a few other odds and ends.

What was the outcome?

So far so good. Renters in place in October 1, property is performing as expected.

Lessons learned? Challenges?

Upgrading to B class is worth it.

Difficult to keep a good contractor busy enough to keep loyal.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

George Lensch (AGENT)

I just recently closed on a house I sold to a tenant and did seller financing. Georgia is an attorney closing state and they handled everything including recording the mortgage and making up an amortization schedule that was provided to the buyer. We did 20 year at 7% fixed. It's highly likely that they'll finance out of it but it would be to our benefit from a capital gains standpoint if they continued to pay us... It has definitely created a complex tax scenario as we have to deal with depreciation recapture, an installment sale, interest earnings, capital gains, etc...

Easy peasy.

Subject To is when a buyer takes over a seller's mortgage without paying it off and starts making the payments, the title transfers to the buyer's name and the seller has no recourse if the buyer stops paying the mortgage payment (The seller CAN sue the buyer though if payments stop and would probably win) The bank can call the loan due on the Due on Sale clause

A Wrap is where the old mortgage stays in place and an attorney creates a new mortgage for the selling price. The title transfers to the buyer's name. The buyer pays the seller and the seller pays the bank. The agreement allows the seller to foreclose on the buyer if the buyer stops making payments. The bank can call the loan due on the Due on Sale clause