All Forum Posts by: Jeff Copeland

In a coliving setting, two of the big draws for tenants are 1) all utilities included, and 2) flexible lease terms.

You should be collecting premium rent (compared to a traditional LTR), and that single rent number should include utilities for the tenant. 

Of course, you do whatever works for your business model. This is just my opinion. 

Do you mean approaching your buyer's agent about offering seller financed terms to a seller?

This is pretty routine. Real estate agents put together seller financed offers all the time. In a lot of ways, they are much easier transactions to manage as an agent than those with traditional bank financing. 

You would simply tell your agent the terms of your offer, and they'd write it up and submit/discuss it with the listing agent. Not much different from any other offer really as far as your buyers agent is concerned. Most states even have preformatted contract addendums for seller financing, so your agent would just full in the blanks with the broad strokes of your offer. 

It's more important to understand when seller financing is feasible and appropriate.

Check out https://www.biggerpockets.com/... for a more in-depth explanation.

In most cases, a valid lease survives the sale of a property, unless there is a terminate on sale clause in the lease. 

Ideally, you'd need to see a copy of the lease to fully understand the terms and conditions. But it's fairly safe to say the tenant has the right to continue their leasehold until the term expires and proper notice of non-renewal is given. 

Another option is to negotiate with the tenant to terminate their lease early or "buy them out" of the remainder of the lease. 

They will primarily be concerned with the asset: Income, Expenses, NOI, and DSCR.

In real estate, it is not uncommon to create a new LLC for each property, so they will be less concerned about the entity itself.

More like 80% asset & DSCR, 20% borrower (credit score, cash reserves, etc).

The Fall, and the holiday season (Q4 in general), is the worst possible time to list a property. On top of this seasonal slump, you had the interest rate spike at the same time. So this isn't surprising. 

Has there been any change since the first of the year?

Things will definitely start to pick up more in the Feb/Mar/Apr timeframe if you can wait it out. You might even consider taking if off the market for a new weeks (61 days will reset the DOM), staging, and updating your listing photos.

Renting can also be a good plan B. Rather than paying short term capital gains tax, renting it out for a few months and possibly paying long term capital gains tax when you sell could offset some of the holding costs, etc.

Happy to help with a rent versus sell analysis if you're still stuck.  

You should connect with @Mary Beth Blackwell!

@Palmer Thomas - See my comment above and make sure you understand what a balloon payment means. I do not understand what you mean by "He is actually more interested in keeping the loan going after the balloon". 

Once the balloon payment is due, you pay him off in full and that's it. The note does not continue after that. 

The underlying point here is you will need to have the cash to pay off the full balloon payment when it comes due. This is often done in conjunction with a refinance into longer term debt. 

It's a bit more formal that an IOU. Seller financing normally includes a recorded mortgage, and a promissory note (or a deed of trust in some states). Realtor commissions on the sale are paid out at closing. The type of financing the buyer uses does not affect the realtor commissions. Bank of America could be the lender (n the case of a conventional of commercial mortgage), Joe The Seller could be the lender (in the case of seller financing), or Hard Money Mike could be the lender (in the case of the hard money loan or any other type of private financing), or the buyer could pay cash. None of this affects the commission. 

As a realtor, you don't really need to be intimately concerned with the state laws and types of documents used - These will be prepared by an attorney (often in conjunction with a title company) just like they are for any other type of financing. 

You just need to negotiate the seller financing terms in broad strokes. 

Check out https://www.biggerpockets.com/... for a more in-depth overview.

You simply need a commercial lender. They are not hard to find. 

Conventional Fannie/Freddie backed loan products are for individuals, and 1-4 unit properties. 

Commercial loans are more commonly utilized by business entities (such as LLCs and corporations), and, in the case of multifamily, more commonly used for 5+ unit properties.

@Dave Foster is our resident 1031 guru. I am not sure how the IRS views a second home that was mostly rented out for investment purposes. Dave can chime in on that. 

But the rule thumb is generally two tax years, which in most cases is a minimum of 366 days.