All Forum Posts by: David Dey

Wayne is absolutely right.  The charge off is their internal situation.  For them to go through the process of collecting or enforcing their collections (I.E. placing a judgement on you that attaches to other properties etc.) they would have to go through the due process to enforce their note.

Actually, the fact that they have internally charged off your debt may open an opportunity to negotiate a payoff for absolute pennies on the dollar.

As with all things like that, it's always best to get representation for that process. 

Hope this helps

The very simple solution is to look up public records.

First, start at the property appraiser's site or call their office and ask who's name the property is in.  If it is still in the lady's name, very simply, the bank doesn't own it.

Next verify through the clerk of courts/register of deeds to see if the bank had started foreclosure proceedings.  

If you are in a judicial state then look for an LP (lid pendent, if non judicial, then look for a NOD (notice of default) if it was awhile ago (2008-2013) chances are that this is a zombie foreclosure. (Bank starts foreclosure proceeding then stops and cancels them and either sits on it or writes it off and walks away)

Either way, as long as the property is in the lady's name and there is no active proceedings against it, you may have an awesome deal on your hands.  In which case, reach out to the grand daughter.  

If you need help on the verification process and the steps to take, feel free to PM me and we'all chat.

Hope this helps

You have to go through the agent  However, you can require that you are present when the agent submits the offer.  That way you can explain the details and negotiate the terms of the contract and financing.

Not many people use this option, but it is an awesome way to make sure your scenario is fully understood.

Some agents might fight back on your request.  

I'm not sure about other states, but in FL you actually have the right to demand to be present when the agent is submitting the offer.  (I would be surprised if that is not the same elsewhere)

Either way, you should be able to sell the agent on the fact that by allowing you to be present, he/she will shorten the negotiating period by removing all the back and forth of a contract offer and counter offer and having it all done in one sitting.

Regarding letting the interest accrue, make sure to set a reasonable deadline for the refi or sale timeframe.  The shorter the timeframe the more likely to have your offer accepted.

(Remember, if you need additional time, after the closing you will be able to deal directly with the owner.  Renegotiating is not against the rules)

or very simply, create a single assert entity. Then contract the property into that entity.  Sell the entity for your fee.

A lil more expensive then the other ones, a lot cheaper than a back to back, a whole lot cleaner.

@Ebahi Ejerekhile I'm not positive exactly what your asking, so I'll just wing it and make stuff up and try to sound like I know what I'm talking about.  ;)

As far as closing cost, I don't know if there is a name, so we'll call it kophifeshlagan!! 

But, as mentioned in my post above, there is no such thing as set contract terms.  This includes, not just mortgage terms but contract terms as well.  Whether you want the seller to pay your closing costs or mow your yard for a year in a chicken suit, if you both agree to the terms, it's a deal.

The absolute simplest way to get your closing costs paid would be to offer to raise the purchase price by the amount of your costs and have the seller pay them out of pocket.

Another is to tell the seller that the closing costs must come out of your down payment. 

In your negotiations, very simply start with option 2 and if they balk, move up to option 1.

As for carrying costs, or "phhrrrapping," as we call it in the old country!!  (Just kidding, I thought I'd give this a name too)

(This is the part that I was confused about. Are you asking about carrying costs, meaning your monthly payments while you fix the property and during the time you are trying to flip it?  That's what I'm going to assume)

If it is short term financing, 6 months to a year, there should be no problem to get the seller to just let the interest accrue and just receive it in one balloon payment once the place is sold or refinanced.

Even if it is a longer term financing, I still ask for at least the first 3-6 months with no payments or interest, "to get my ducks in a row."

Ex: A number of years ago, I bought a MHP for 750k.  I was able to get owner financing for 650k with no payments and no interest for 12 months then the payments would start at 5.5% or so.

For 1 year, I ran the park for 100k!! This is the power of owner finance.

Hope this helps!!

@Jamal Shabazz  there is a little bit more to owner financing then just that.  

There are multiple forms of owner financing. There is the standard that was mentioned by @Luka Milicevic where the owner owns the property free and clear or with a very high equity position.  (One where the down payment that you give is sufficient to pay off the balance)  and the seller carries back a mtg or deed of trust under negotiated terms.   (Terms is a whole other ball of wax that we can go into later, but suffice to say, terms can be what ever you and the seller can agree on.  It does not have to have a standard interest rate or standard payment schedule.. If you can get the owner to agree, you could make the payments $1 per year for 1000 years at no interest.  Not saying you would just saying you could)

Another type of owner financing is called a wrap around mtg.  Let's say the owner of a house selling for 100k has a mtg of 70k.  You could offer him/her 10k down and have him "wrap the first mtg," which actually means he would be taking a second mtg for 20k but would receive payments for the entire 90k and be responsible for making his payment for the 70k out of that payment.  (Now in a situation like this, you will have to put in some checks and balances in place to keep both sides honest... Such as requiring receipts for the payment to the first on a monthly basis, or having full payment made to a 3rd party servicer who would make the first payment on behalf of both of you.. Etc)

Other options for a high liened property would be a lease option or an agreement for deed.  (There is plenty of education on this site regarding these two options)

Seller carried second mtgs are an awesome option for a no money down deal.

Let's say the owner of a 100k property has a 30k mtg on the property and wants some money to pay off his car and credit card bills but is willing to carry back some money.  This is where you can use the power of private money to make you a phenomenal no money down deal.

We'll say that we get the owner to accept 50k to him with him carrying back the balance of 50k in a second 2% (yes this can be done)  if you can find a private lender to give you 50k at say 8% in first position, (which shouldn't be too hard since they are lending 50% ltv of the purchase price with a feeling that the second would probably step up to protect their interest if you defaulted) you now have a blended interest of 5% on the full 100k  (not bad for a no money down privately funded deal.)

Bottom line there are a number of cool strategies that you can utilize to have the seller assist you in buying the property.  The key is to find their hot buttons to give them what they want or need.  You do this simply by listening with a problem solver's ear.  (If you listen to someone long enough, they will tell you their problems and even how to solve them.)  your greatest tools of negotiation are your ears.

Hope this helps.

As someone who invests in Florida, mobile homes are par for the course.

Investing in MH's are not that scary, just keep some basic rules in mind.

1) Try to buy newer than 80.  

2) Try to buy MH land packages. 

3) There is a niche for buying in parks which can be profitable, this is called Lonnie dealers.  (Named after Lonnie Scruggs who teaches on the subject)

The secret to Lonnie dealing is to either buy packages of homes from an owner of a park who is only looking to rent lots.  (When you buy the homes, you negotiate a deal with the owner that you don't pay lot rent while the unit is vacant and get a preferred lot rent when rented, for all your current and future homes)  

Once you are set up in the park, market to the other owners in the park and offer to buy from them when they move out.  (You will get deals at steep discounts.. Many of them as low as $500-1000, since in most cases "they can't take it with them.")

4) Do lease options instead of simply leases.  (This strategy works best with land home packages and will allow you to make your rent while having them handle the maintenance)

5)  Find stores that cater to second hand MH material.  

(This will save you a bundle on rehab and maintenance)

Hope this helps!!

@Wayne Brooks the contract probably does say that, but fraudulent inducement should trump contract clauses.  

If you can get them to promise you that the code violations will be cleared and that the bank has given instructions to fully clear the title including these liens, you should be able to rely on their representation to enter the contract.  

As @Steve Babiak mentioned in the post above ours.  The bank is likely to just send back the same contract.  

If @Chad U. wants to not lose the deal, and wants to try to move forward with it, this is the way to do it.  

This way, the bank isn't gonna wanna try to withhold the small deposit and risk that strong a stance.  

Also, Chad will have a strong stance to sue for performance if it comes down to it.

Of course, the fact that this is a code enforcement violation has been "cured," most municipalities will reduce the lien to admin costs and such which you can help negotiate and the bank will likely be willing to pay once reduced....

ORRRR, Chad may even offer to take the property subject to the lien for a steep discount.  (Again, having verified from the municipality that they will negotiate)

I did that with a 10 unit apartment complex here in central FL where I got the seller to sell me the property for 25k subject to over 300k code lien that was accruing at $300 per day.  (Long story short, I was able to get the lien reduced to 1k!!  Talk about a short sale)

Anyway, I hope this helps!!

the good news is that you have had email confirmation from the representative that they would be giving you clear title in order to get you to sign the contract.

This is known as inducement.  If they violate their word this will become fraudulent inducement and that will invalidate the contract. 

The way I see it,  I agree with everyone so far regarding the discrepancy between the contract and the addendum.

This is how I would view it.

The addendum trumps the contract, however, the emails trump the addendum.

I would make your stance very clear in your email and let them respond to them, then you can sign the contract with fair certainty that you will be protected by the email chain evidence.

After you get the contract signed, ask the title company for a new copy of the title commitment and present them with the email chain with your very specific requests and their response.  They will have to use that as part of the contract and change the commitment to reflect the removal of the exception.

@Michael Marrow

If you go through my past posts you will see a common factor.  I am a huge proponent for public records.  "Business in a box," I call it.   

Through public records you can find all your sellers, all your buyers, and even the money to put the deals together. 

(Imagine being a one stop shop where you not only offer the great deal but the money to buy it?  Think the buyers will come?  You bet your... Tucous they will.)

Anyway, my mentor taught me one of the most valuable lessons I still use to this day.  

"You can market all over the world," he said.

"But, your real buyer is just a stones throw away."

What that means is that, if you're trying to retail, you should market to the neighborhood.  Someone always had a friend or family that they could refer to you.  (And who wouldn't like to pick their own neighbor? And make a referral fee doing it?)

If you are wholsaling, do a grid search in the neighborhood, or in a mile grid of the subject property.  

Most of the time you can do this through your property assessor's office.  If you wanna do it the easy way, ask your realtor to do a comps search of all the sales within that area within the last year.

Now you will have to do the rest of he legwork yourself, (or hire someone to do it for you) but for a nice profit a lil elbow grease shouldn't hurt, right?

Match the sales to the property appraiser.  If it doesn't show up quite yet, do a name search for the previous owner (still listed on the assessor's site) in the clerk of courts/register of deeds and see who they sold it to.

Only keep the names of the Corporations, LLC's, Trusts, IRA's and obvious investors. (If you see the same guy buying 3 houses within a mile within a year, pretty safe bet those aren't his summer homes)

Now, do a google search on their biz name or individual name.  Do a google search on the company address.  Research the company name on your secretary of state's site. Etc...  The fact is, it won't usually be too hard to find them.

3 benefits will arise from this list.  

1) these are not tire kickers.  Public records don't lie!! The only reason they will show up is if they pull the trigger.

2)  they are already buying in the neighborhood.  If you have a good deal and you use this approach, you will almost definitely have a sale.  (One of the biggest issues newbies have is getting the time of day from seasoned investors)  if you use this proactive (and definitely not a beginners strategy) you will most likely impress them enough to get them to listen.

3)  look at the prices that they bought the properties at and you will notice a trend of what investors are willing to pay for a house like yours in that area.  It'll give you an idea of whether you actually have a good deal or not.

P.S.  Here is a rough and dirty approach to getting a decent valuation.  (Both retail and wholesale)

Now keep in mind, this doesn't replace an actual appraisal.  It just gives you a down and dirty look.

If retail just follow the same steps with owners with the same mailing address as the subject property.

If wholesale, only houses that the owner has a different address then the subject property.  (In the same state)

Pull up all the sales in about a 1/2 mile radius, (mile if there aren't enough sales) last 6 months is best, but 1 year will do if not enough sales.

Let's say you have 10 sales, take the price and divide by sq footage.  Ex: 1000 sqft house sold for 100k.  That is 100.00 per sq ft.

Take out the sale with the highest sqft price and the one with the lowest price.  (Now you have 8 sales.)

Figure out the average dollar per sqft.  (Add up all the 8 sales then divide by 8)

Now match that average dollar per sqft times your house's square feet.

For the retail, that will give you the ARV, for wholesale that'll give you the wholesale value. (Approximate)

Hope this helps!!

P.S.S.  If this helps, send me an upvote!! (Shameless plug, but I'm trying to hit the leaderboard!!) 😜