All Forum Posts by: DeAndre Mason

@DeAndre Mason

I am a little confused. The "seller decided to have a realtor assist with the deal" and "realtor will not be getting any commission she is just trying to get the property sold because she is tired of dealing with the seller"

Can you please clarify this?  

Many standard contracts have assignably terms built in and others such as Florida it is listed as an option.  This is a negotiable issue and I would not sign it until you are happy with terms.

Kudos to you for wanting to compensate her, it would be smarter and keep it legal by having her sign a single agent representation agreement with you.  Keep her from possibly taking a Commission outside of proper channels and getting in trouble. 

propstream is great for comps. It's great for everything really. The one issue I've had with comps in my market is that sometimes the square footage doesn't match what you will find on zillow. This is because prop stream pulls from public records which is sometimes updated because people do additions and stuff and don't get permits for their work. In zillow the square footage is manually entered so it's usually correct. You'll need to cross reference your square footage. This bit me in the *** before. Imagine doing deal analysis on a house that you think is 1100 sq ft and it's actually 2500 sqft+!

 This must be a VERY rural area, as in the worst areas in OH we get 700- 800 for 1 brs  this is not a good deal , I wish him well. 

Hello DeAndre, I would like to echo the sentiment that the other people here have discussed as well as add something. First, if you want to use private money to finance the down payment on a turnkey rental, you will not be able to refinance out of that private money. When you go to refi the bank is still going to want 20% LTV (however you could get as low as 15% with a DSCR lender). Because you are not going to be adding value through rehab or increasing the net operating income you will not be able to pull out any of that private money to pay off your private lender. Additionally, some lenders for your primary mortgage will not lend to you if you are also financing the down payment. Lastly, most private money lenders are not going to want to go to 100% LTV. This is because they are in a second position mortgage. If you default you primary loan gets paid off first then the secondary loan. If they go the 100% LTV suddenly the value of this property drops 5% now they lose money if you default. This is why banks don't lend 100% LTV. If you want someone to do the second position loan for you it will probably need to be someone who knows you personally and trusts you a lot. If you can't figure out the financing but know it is a great deal you should wholesale it. This will give you some capital so that hopefully when the next deal comes around you will be able to afford the down payment. Let me know if you have any other questions!

 Is this 2100 gross on 6 units? That only 350 per unit ?  $10k a year net on 200k  thats  only 5% ?  Also what about garbage, Yard care/ snow ?  Be careful, the rent indicates not a good area. 

@Matthew Lynch

Hey, most people do not know this but for FHA loans you CAN purchase a 5+ unit. You just have to decommission the units and bring it down to "4". In your case, you would have to decommission 2 units. You wouldn't be able to rent out the 2 if the 6 units until you refinance out of the FHA loan. Talk to a lender on their requirements, but most of them require either to remove the kitchen appliances and/or knock down a wall so that the two units are "duplexed" or combined with another unit. Totaling it up to 4 units.

EX) If the six unit building has 1 bed 1 bath each, you'll combine them to have two units that are 2 bed 2 bath and two units stay 1 bed 1 bath.... And there you go, you have a 4 unit building that is FHA approved.