All Forum Posts by: Nathan Cao

greeting from Okc, It's nice to hear someone doing well in Oklahoma esp with mobile homes.

-Nathan

I just received a call from my banker telling me that this policy would be effective on June 29 2008. This really slow down a lot of new investors like me. Does anyone know if this applies for the whole lending industry?

-Nathan

Hello Everyone, i'm quite new to RE and i'm looking at my 3rd deal which is a duplex. The owner acquired the property through tax lien foreclosure over 2 years ago and has been renting it out. We've been in the negotiation process and he told me that i should call my bank first to see if they're ok with Tax Deed Title. The owner told me that if i purchase the property, the title company has to do extensive title search and convert the "Tax Deed" into a "Warranty Deed". I'm not so familiar with this and i'm wondering if there are anything else or other risks i should be aware of? Thanks

-Nathan

To answer your question, 85% appraised value meaning that 85% of what it's worth in the fair market value.
No, as long as the ARV is LOW enough, a refi should work.

I think you're mistaking your understanding of ARV. ARV is after repairs value which typically you don't want to go over 70%. But even at the worse case scenario, let's say you're at 80% ARV, you're still can refi it at 85% after 1 year.

i don't know if your local banks are different but here they will only refinance up to 85% of purchasing price if you want to refinance right away. now if you wait you can refi up to 95% of the appraise value after 12 months.

you try to talk your friends out of buying his/her dream home because it's not REO/Foreclosure.

Hello, I'm pretty new to REI and i've been looking for creative financing to save as much cash as i can. Last week i was referred to a Mortgage Company by a Hard Money Lender. And it turned out they're offering 100% financing and possibly extra money for rehabs.

It took the mortgage officer a while to try and explain this whole process. Here is how it structures/works:

Actual Purchasing Price: $30,000 (Seller gets paid this amount)
Inflated Purchasing Price $36,000 (This is the amount the lender will lend)

The trick is that I will sell the seller a package of "Home Discount Products"
and I will get 16% commission which is $5760. I will then use this amount to pay 10% down payment ($3600). The rest of the left over money I will pay toward closing costs ($2160). In this case, If i use 20% commission, I can take some of the left over money for rehabs.

A few rules:
1) Commission % cannot exceed 20%.
2) Appraisal Value of the house must be equal or higher than the "Inflated Purchasing Price".

Further clarification, this Home Discount Products is a company set up by the founder of this Mortgage company as a dummy company that works solely for this creative financing purpose. Another thing is that at the end of the year i will get a tax form from this company where i would pay 15% of the total commissions i made :(.

Infos on the Mortgage company:
Phoenix Mortgage Group LLC
http://www.phoenixmtg.com/
Their commercial lending company is
http://www.wepinc.biz/

I've heard of mortgage fraud and i have a few doubts about this company.
I'd like to hear some professional opinions on this. Thank You

-Nathan

Thanks everyone. I just realized an effective/realistic method to calculate cashflow and as well as knowing how expensive Hard Money is. Looking back at my first deal that i was so fortunate to back out (due to it being in the flood zone :)). Yes, it has $0.00 cashflow based on this method of calculation.

I think i can get the seller to sell at the highest price which is $32,000. Now let's say at the worse case scenario (buying at $32,000), I would take a conventional loan for $32,000 at 6% 30 years term. I'm looking at $80.00 per door.

I realize the norm is $100 per door and i know $20 of cashflow can make a difference. My question here is how low would you guys go as far as the cashflow per door to consider it a decent investment?

Thank You

-Nathan

Tenants pay all ultilities bills.

I might offer him 28k Cash using Hard MOney and get refi later with banks.

Hello everyone, I'm a new investor looking to learn more about duplexes and how they're different from single family homes.

I happened to called a for sale by owner and turned out the owner has more properties for sale. This owner/investor invests strictly in tax liens; he acquired most of his properties through tax liens.

This duplex he's selling is currently rented 1 side $350 and the other is rent ready.
1 bed 1 bath 688 SF each side.
Asking Price: $36,000
Rent: $700
It has central heat and air, new roof, plumbing work, new windows, he pretty much remodeled this duplex.
I will find out more about taxes and insurance tomorrow. i would guess about $100 a month.
I did the comps for the area and it's varies but i believe this house is worth around $45,000-$60,000. I think i can get it under $33,000 (i will start my offer at $28,000) or lower.
He's willing to carry owner financing with 20% down,9% interest for 15 years.
I have the cash for the 20% down payment but i'm wondering if there other creative ways to do this and save my cash.

I have about $25k in cash reserves and i don't mind using it but it's would nice to save it if i can.

Any inputs advices would be greatly appreciated.

-Nathan