All Forum Posts by: Dean De Pew

I am not an expert and I am very new here on BP, but this is my understanding. The HUD contract is not state specific, as far as I know. I think what Christopher was saying is that he asks for a 45 day window to allow more time to market the property. And DO be careful about your marketing... I put up a sign in the yard and OH BOY!!! Did I hear about it. The listing agent and my agent were quick to point out that there is no marketing a HUD property, until after my closing. Makes it tough to show the property to any potential buyers, too... You have to be a bit creative. If you are the selling agent you have the lock box code... If you "get caught" and the Listing agent or HUD inspector finds out...you could KILL the deal and forfeit EM. The other thing you can do at least here in IL, is to add the end buyer to the contract, even after the initial contract is written. After closing you do a quit claim of your interest to the end buyer and they "reimburse" you for your expenses. I think the LLC approach works too if you work fast enough. I believe it needs to be an LLC that is "Property Specific" in name? One LLC to each contract??? You really need to verify that last point... Not completely sure it HAS to be so, but It is cleaner if you do it that way.

Analysis paralysis can kill you!!! The object of analyzing things is to learn. The more you learn the more you realize how much you don't know! Make an offer... You will discover there are literally dozens of things that you didn't know you didn't know.. Sounds silly, but very true. I have done this business in the past and I took some time away to re-locate to the garden spot of the country, Far Northern IL burbs. You know all that sunshine and stuff, that everybody moves here for. I am amazed how much I am learning from the deals I make an offer on.

     Go get em! You can do it!

The real question is... If I have an extension that has been approved and is good til Jan. 28,,, Can the seller kill the deal, if I do not give them a quick, uninformed answer?

Details: I have had a HUD home under contract for quite some time. The ARV is approx. $135,000, with very few repairs, maybe $5000 most likely less.. I have it under contract for under $75,000.The closing date has come and gone several times... There have been several extensions to the closing date on this deal, (at no charge to me), due to an issue with the local village and HUD. There was a demand, by the village, that the property had to be connected to the village water supply by Sept 22, 2014. My offer was accepted after that, on Oct 4, 2014, or so. I asked HUD to connect the water as they were required to by the village. They paid the permit fees and the right of way fee to the village and gathered up bids to connect the water... We are dealing with potentially frozen ground and LOTS of trees 30-40 of them, 100 ft. setback. The latest extension has been approved and is good until 1-28-15. Today HUD came back with a decision NOT to connect. HUD does not want to make the water connection to this property. In lieu of paying for the repair, they have offered me a $9,000 credit, with the condition that I need to assume the cost to connect the water, post closing. This is awesome… I believe I can get the water connected for less than the $9000, I think, But… I still do not have an end buyer to assist with the transnational funding I am using for my POF.

I am working with several people that have told me, when I get the water issue resolved, they want to talk…..? I feel like I have been trying to steer a parked car and now it is starting to move! Yeah! Forward motion!!!!!!!!!! HUD is trying to get me to make a fast decision to continue or not... As in, like today or they will cancel the deal. Since I have not had proper access to the property, I have not been able to get a solid quote for the water connection. Can they do that?

I believe this is a viable deal, but I do not want to blow it by not responding fast enough to suit HUD... Anybody want to make some money? LOL Any and all thoughts are welcome.

Everything works somewhere, Nothing works everywhere. I like that!

Hello Belinda,

     All great advise. Thank you for the insight. I will look at that Pro acct. also.

Thanks again,

Dean

I hope someone can point me in the right direction to achieve this.

I am involved in the "Cash Buyers" area on this site...  I keep seeing commercial lenders listed. Does anyone have experience with a residential Private lender? I keep seeing lots of what seems to be scam artists asking for upfront fees. I understand there are fees needed to be paid in order to get the deal done, but when none of these Private Lenders has any feed back I can verify, it seems like sending them any money would just be foolish. I have a deal under contract and I need acquisition & Re-hab funds of about $80K. 

I wanted to just wholesale it with transactional funding, but so far I don't seem to have any cash buyers coming forward. Therefore i feel i need to do the fix & flip play in order to make this a winner. I don't have the funds currently available myself. I need a private lender I can trust or an angel investor, a JV partner or ??? I am open to ideas.

     Please be creative.

Hello Scott,

     Ok, Just a crazy idea!!! I have heard of this approach, but not sure there are any banks out there that will still do this. A "Blanket" mortgage. Encumbering multiple properties under one loan. By doing all of your properties together, you only have 1 loan. Sounds simple... I have heard about these loans for years, but never found a bank that is willing to do it. Many have said, it can no longer be done and that may well be true. I haven't looked for this for a couple of years, but with some of the "guideline easing" we have been seeing in recent months... It is possible, this is once again available. When it was available, the big banks wanted no part of it. You would have to limit your search to the community banks. I did hear at one point about 5 years ago there was a bank called Liberty Bank that would do it. I search Liberty Bank and came with so many that I didn't get to contact all of them and came up empty.

      There are definite limitations presented by this kind of action too. For starters, when you try to sell one of the properties and have to negotiate a partial release from the lender. That might be hard to do if you have taken additional debt since the origination. 

     As I said, I have never found a lender that will do this....  But I haven't had the circumstances that would benefit from this approach either.

It might be worth looking for it. Something to think about.

Any interest in the far Northern Suburbs of Chicago? NOT Cook County, Lake County. I have a property that might be what your buyers are looking for?

Dean

Hello Jacob,

Do you have any interest in a rental or flip or JV in the far northern suburbs of Chicago...Not Cook County, Lake County. Almost Wisconsin. I have a wholesale deal in Beach Park, IL. 1985 sq.ft. 3 bd, 2.5 ba, 2 car attached garage all on 1/2+ acre $85,000? ARV 140K. Drop me a line if yo want to know more or call 224.440.8827

I keep reading that wholesalers who have cash buyers are "always available".... where? I need one. I ha e a deal that I need a jv partner on in Far northern Illinois. Not Cook Could try. Let me know if you have any ideas.