All Forum Posts by: Jay Feldman

Keep in mind many FHA lenders will not allow the process/contract to start until the 91st day. So it may be more like 120-160 days you will need to hold it. Good luck with your deal.

Jon
No, 2850 per month per building X 2.
loan is 165K per building X 2

What can one expect for income from 2 coin washer/dryers (2 washers 2 dryers) from 6 rental units?
Thanks

Mike
Yes, at 12% it is not a deal. I will be managing it myself in the beginning and I may be able to complete the project for less there for I might get it to break even until refied. Carrying the difference (loss) was figured into the project for up to about 14 months. Bottom line is I saw this as an opportunity to get into the rental market with out having to tie any cash as well as winding up approaching 200K in equity when the projects are complete.

Thanks for the reality check.

Hello
Up until now I have been buying, rehabbing and selling. (mostly SFH) I just closed on my first rental property I plan to rehab and hold. As it turns out a REO came on the market two buildings down at the same time I was in the final stages of the short sale of the one I closed on. I put and offer in not expecting it to get approved and low and behold, it did. I close on the second building next week. (it in much better shape as well)

The numbers look like:
Building one, 3 family flat. Each floor is 1000 sq ft +-. When finished all units will be 3 BR. I plan to put 2 sets of coin washer/dryers in the basement of this building. (the tenants from the other building can walk over.) Neighborhood is not great but definitely not a combat zone, Housing rate is about 950 for a 3 bedroom with separate utilities. Gross Income on both buildings should be 2850/month plus laundry income. Owner pays for water and sewer, tenants pay the rest. (heat, electric and hot water)

65K Purchase price including points and all fees.
100K Rehab cost including holding costs.
165 total paid for with hard money loan (4pts @ 12%)

Building two floor plan is almost a clone to building one but in better shape.
85K Purchase price including all points and fees.
80K Rehab including holding costs.
165K total. Paid same as above.

Plan is to refi out of the hard money loan in 6 to 12 months. I assume if the bank will accept even 75% LTV and 75% of income I should not have a problem getting 100% financing. Last time I checked I had a 730 FICO score.

What do you folks think?

ARV is 265K on both buildings. (appraisal done by conservative appraiser for hard money lender)

I am no expert in what the banks are selling off there toxic assets for but my guess is it is a lot less than they are approving short sales for. If that is the case even if the government pays more then market I think the banks will still be getting more by approving short sales. Does any know what type of discounts the pools of distressed mortgages are selling for?

Originally posted by Pedro Gonzalez:

By purchasing mortgages in massive quantities from banks and other lenders, we should see a stop on foreclosures and help more Americans keep their homes, which will act as a brake on decreasing prices of residential real estate.

Pedro,
Please tell me how buying up the debt will stop the foreclosures? Can you give us some details on how you think we can help people keep there homes? Do you think if someone can't afford the mortgage they should have the payment significantly reduced? If so why? many of the folks I see facing foreclosure are not short a few dollars a month. They would need to there payment reduced by 30-50% for them to "afford" there payment.

I do not like the benefit the banks will get from a bail out but, I dislike what I think it will mean for all of us more, if we don't bail out them out.

My gut tells me a bail out is better then the alternative. I believe that the only solution for the people who should not have gotten a loan is to loose there property. Who's fault it is or was does not change this. Nothing else makes sense logically or economically.

You hear the politicians screaming that the government needs to help home owners keep there house. There is no magic. If they can afford there mortgage fine, if they need some breathing room that's okay with me also, but long term if the numbers don't work they need to learn from it and move on.

I did not live through the great depression and I sure hope we are not about to relive it. With all the sh#t that this world is experiencing right now, anything could happen. On the other hand this is a amazing time to be alive.

If he has his act somewhat together now I would say he should mention it as the reason for the missing docs and say something along the line that he has learned through his experience and wants to preserve any credit he has. Thats my 2 cents.

I have done SS deals with very little info. Why is there not info? If the reason is legitimate and not something made up to hide assets just have them disclose it in there hardship letter. They could have moved and lost it, lost it in a flood, not have worked for 3 years, some one through it out, etc. Give it a shot. You might be surprised what the bank will do so they do not have to foreclose.
Good Luck.

Dave
I think by using the 50% rule he already has some of the taxes included in his expense number.