All Forum Posts by: David Cruz

Quote from @Jeff Copeland:

Typically, you have to find out who's name the mortgage is in (presumably the current owner) and have them sign an authorization to release information.

 Seems like the current owner (or possibly a tenant) is still living on the property. I'm going to guess they may not want to assist in any way.

I am researching a property that will be sold at a county foreclosure auction in Florida. Upon review of a title search I realized it is the second mortgage holder that initiated the foreclosure process. My understanding is that the winner of the auction will take title to the property subject to the 1st priority lien. Any amount bid in excess of the 2nd mortgage judgement goes to the current homeowner and not to satisfy the 1st mortgage balance.

In this case, that first mortgage is from 1992 and has been assigned a half a dozen times. Given that the mortgage is from 1992 and that the 1st lien holder has not initiated the foreclosure I assume payments have been made. 

Is there anyway I can find out what the balance of the first mortgage is so I know what I should bid on the property? Any other advice you might have given this scenario?

Thanks!
 

Quote from @Issac San Miguel:

Quote from @David Cruz:

I recently closed a refinance cash out with Lima using the 30 year fixed rate rental loan. My experience wasn't the best. This was for a property I had previously purchased in cash so the delays didn't cost me a deal. Let's just say that the promises made by the sales consultant did not line up with what underwriting delivered. Most notably they significantly dropped the % of how much they allowed us to cash out when the property appraisal came back very strong. Went from being told we can cash out up to 80% to them only wanting to allow 60%. Lot's of delays too.

 Curious about this - did you ultimately cash out at the 60% or did you shop elsewhere?

What rate did they end up offering at 60%?

Ultimately, I decided to still close. I ended up at 6.2% fixed for 30 years. Closed in June with lots of uncertainty about rates and Lima would not lock in a rate until the last second.

Here are the #'s on this specific deal for background. Bank of America single family foreclosure purchased for $110,000. Rehab cost $45,000. Appraisal comes in at $243,000. I rented it for $1,850 a month. At 60% cash out I felt like I got most of my money back and was still satisfied with the deal. Was also concerned rates would continue to rise if I had to start again. The reason I was given for the reduced loan value was no rental history since I had just signed the 1-year lease and the short seasoning period. I had held the property a total of 4 months or so when we closed. None of this was disclosed when I had asked the sales guy about seasoning requirements on the front end. 

I recently closed a refinance cash out with Lima using the 30 year fixed rate rental loan. My experience wasn't the best. This was for a property I had previously purchased in cash so the delays didn't cost me a deal. Let's just say that the promises made by the sales consultant did not line up with what underwriting delivered. Most notably they significantly dropped the % of how much they allowed us to cash out when the property appraisal came back very strong. Went from being told we can cash out up to 80% to them only wanting to allow 60%. Lot's of delays too.

Quote from @Mitch Davidson:

Hi friend. I’m sure you’ve heard many tips on how to start investing, how to grow, etc. Below is some advice that you may have not heard. In fact, it’s so unpopular and counterintuitive that a Google search for supportive imagery produces almost nothing to use. Our culture, economy, and media are permeated with the notion that everyone should have a nice, newer car, and that they should use a loan to obtain such.

Get rid of your car loan! And if that means driving an old, unimpressive car, so be it!

Consider this. Using a 6% interest rate for sake of example, the increase in your DTI that a $599/mon car payment makes results in you being able to borrow $100K less on a 30-year fixed mortgage. Likewise, a $1K/mon car loan reduces your loan limit by about $170K.

Also consider the fact that unlike the house you might buy your car is losing value every day, while you pay interest on it.

I know it's hard to consider a lesser car. I've been there and done that. I’ve argued with myself that a nicer car supports my career and relationships, which isn’t really true. Now I couldn't be happier to have much more real estate and wealth because I downsized my car spending.

If you need additional lending advice, or feedback on investing in western North Carolina (WNC) markets like Asheville, I'm happy to help. 

Mitch, I am considering upgrading my current truck. Any opinion on purchasing and titling a truck in your real estate LLC? You can deduct the 6% interest in your example. Plus if the truck weighs enough you get the Sec. 175 hummer tax loophole credit and write off 100% of the purchase. Just need to use it for 51% business use. And if the truck loan is secured in the LLC, would it even impact DTI on your individual name if you are wanting to do some more 30 year fannie/freddie backed mortgages?