All Forum Posts by: Eyal Goren

On your C/O refinance. If you're thinking a Conventional loan... did your lender say if you'll be able to pass QM with such a small loan amount?

If you're going DSCR, can I ask who you/your lender is using? I'd like to know who else can do loan amounts under $100k. The interest rate you have listed seems extremely competitive - especially given the rough news on inflation this morning.

I would consider a C a bad property.   I would not consider a house that cheap to be near a B.  

At $1200 in rent, you will probably have negative cash flow.  Rising maintenance costs, turnover, Taxes, and other expenses will also contribute to this.  

It is OK not to have cash flow if you get great appreciation.  But I can't see why Cleveland would increase in value based on negative population growth and, generally, being a bad place to live.   If you can break even in Boulder, CO, with 20% down, the property value will probably double over 10 Years.  Not that you can break even there without a huge value add.  You will probably get very little appreciation if you break even in Cleveland.   

At most, you will pay down the debt, and inflation will eat up all gains. You would be better off putting money into a fund that performs at 6% to 8% somewhere with appreciation.  If you can find a good fund that is paying out cash flow.  Based on what I am seeing, many of them are doing calls.  They did their pro forma based on interest rates dropping to 5%.  We won't see that for quite some time, so they are upside down and not cash flowing.  

Area is fine. The rent is high for just a 2 bed though, I don't think you will get 1300 for that. Overall I'd say the deal is not that great. You can get 3/1s and 4/1s in Garfield Heights at that price that will actually cashflow at 1300. Again, biggest issue here is the fact that it's only 2 beds. 

First, let's be very clear here.

The mortgage your speaking of is a private agreement between the seller and the lender. The "due on sale" clause (DoSC) obligates the seller to notify the lender if the property is sold.

Failing to do so would place the seller in violation of this agreement, giving the lender the right to accelerate the loan.

But no laws are being broken here.

So, subto is neither legal nor illegal.

Second, it only works because most lenders are more interested in receiving payments than in invoking the DoSC clause and foreclosing on the property.

But, it can work, provided seller and buyer are both on board and the proper process is followed.

Is there a specific reason you want a DFW based lender?