All Forum Posts by: David O

Great thread. I see value in both flipping and holding. Personally I hold.

I really think it depends on the market. In my market I can still find good houses for 30K (on the MLS believe it or not). I put 5-10K in rehab and cash out refi on the appraised value in six months. Then I get all or most of my money back and still make a lot of money off the top renting it.

The last house I bought for 31K and did a 12K rehab. It appraised for 55K, which was lower then I hoped, but most of my cash came back. It currently rents for $925. Escrowed mortgage payment is $362. I manage it myself. Everything in the house is basically brand new, so I don't expect too much maintenance for awhile. If you say $200 a month in maintenance/misc expenses, I'm still making 300-400 bucks and I have most of cash invested back in my bank account.

Are you in title currently or are you in the process of buying and the title company found the lien? Unfortunately the only way to obtain clear title would be for it to be paid off, quiet title action (which would notify the lien holders and if none responded you would get clear title, get the title company to make an exception of some sort (rare) OR wait five years because the statue of limitations on judgments in New Jersey is 20 years.

Title issues could mean anything. It could mean someone else has an interest down the chain of title. It could mean a lender still has a lien on it and is refusing to release it as it is still open. It could be something stupid like a prior owners lien that is closed, but not released. I would be very wary unless you know about title or consult someone who does and know exactly why they can't obtain clear title.

Also, I would want clear, insured title on very deal - even buy and holds. Potentially dangerous and $$$$ draining.

Assuming you like your wife, I would vest as "husband and wife as joint tenants with full rights of survivorship". If anything ever happened to either of you, probate would not be needed regarding the house, in CA.

For your own house? And hardwood is already present? Definitely hardwood.

I like the negativity, it's funny and it motivates me. Going against the herd is always difficult. People feel safety in doing what everyone else is.

I talk to everyone about it, I get negativity, but I don't take it personally. They aren't being negative to you as a person, they are downplaying it to feel more comfortable in their mind. It's a different mindset.

I never try to recruit anybody though, this is something you either want or don't. You have to get over the initial mental hurdles on your own.

I used to work for a title company dealing with all sorts of title issues-100% yes, get title insurance. Regarding title issues - you won't get title insurance without clear title. So any title defects (liens, judgments, deed issues) will be resolved with the transition. Either paid by seller or you depending how you have it set up.

Title companies use large title underwriters for title insurance (Fidelity, First American, Stewart), so any title issues when you go to refi or sell will be insured through them. With title insurance you are 100% protected. 

Is it an old house? How bad is the lean?

I would think if they fixed the structural issues that the lean would also be resolved in the process, at least any lean that would be considered bad. Might be a good deal depending on the estimate to fix and other details, depends. If it's a newer house having those issues I'd probably run because I'd think the house was built poorly.

You sound like a lawyer. With proper precautions it will be fine. Obviously, yes, follow all laws in your state and use common sense.

Out of the three - The only thing I'd be worried about is asbestos furnace pipes and the like as they used to wrap them up in asbestos. Asbestos tile and stuff is no problem. Just encapsulate, don't disturb.

I definitely agree with being above board but the issue with testing is it will come back positive as every house that old has lead and most likely asbestos somewhere. In my state if you test then whenever you rent it you have to disclose it. Which most of the time it's not a good thing as the house will be totally safe once you are done (lead encapsulated, asbestos incapacitated, mold gone). But most tenants will freak if you tell them you have this as no other landlord discloses because they don't test.

If it had one of those really old gravity furnaces you should probably have it checked out as I know those had a lot of asbestos. But stuff like possible asbestos tile I wouldn't worry about. I'd just go over it with new subfloor to encapsulate it.

It wouldn't hurt to have the asbestos guy come out and check and see what he says, but I'd never have a lead or mold guy come unless the mold is everywhere in the house. A couple water leaks with some light mold shouldn't be an issue if you fix the source of the leak and remove the mold.