All Forum Posts by: Stacey Paulin

Happy Birthday BP!  Wonderful site, and wonderful people!  Thanks for bringing us all together.

@Jason H. I suppose it could negatively affect your credit score since the bank issuing the HELOC will pull your credit during the application process. I don't think it will cause a huge change to your credit, though. Your DTI will change, however, based on the size of the line you get.

This is impressive!  Congratulations to you for going through with the deal.  Those numbers look great.  I'm eager to see the rehab breakdown.

If I were you I would shoot for a buy and hold investment for your first property. If you are determined to start flipping right out of the gate, you may want to seek mentorship, but you probably could find all the information you need here at BP to be successful.

How many deals are your analyzing each week?  How many times have you driven for dollars?  Do you have a target market area, and are you intimately familiar with what is going on there?  Have you tracked the success of the direct marketing campaign? What was your response rate?  What kind of list did you use?

 Focus on one strategy and work it the best way you can.  Don't give up.

@Virginia Jones I absolutely would go for it.  I recently did something similar.  I had a 401K that was growing very slowly.  I decided to cash out, take the small hit for drawing early, and I was able to put it all on a deal that is cash flowing nicely.  

Take your time and analyze the deal.  If the numbers look good, do it!

@Adam V. Smart idea.  It's always great to find a good deal with a seller who is willing to finance. I think I'd do the same thing if I were in your shoes.  Better safe than sorry.

@Adam V. thanks for asking the question.  Verbatim it was what I was planning to ask as I am in a similar situation with a deal I'm working on.  @Steve Vaughan, this is the same deal that you talked me through yesterday.  I spoke to the seller again today and it turns out he does indeed have an existing mortgage.  So wrap around will be the best way to take this deal.  I meet with my attorney tomorrow morning and I hope all goes well.

@Michael Le,

I got it!  Thanks for that explanation.  

Yes, 8k or so for repairs, and inspection has not been done yet, so there may be more negotiating left to do.  I'd be very happy with cash flow like that in 5 years.  Thanks again!

@Michael 

@Michael Le @Steve Vaughan

I admit I'm a bit lost; this is becoming a high level RE discussion and I really appreciate the time you are taking to talk it through with me.

Michael, I may not completely understand Present Value and the example you gave, but to answer your question, yes, $62,402 is a very good price for the house.  What has me on edge about the deal is the lack of immediate cash flow, because that is all I've ever considered with traditional financing.  I'm putting the information in my analysis calculators and I see red everywhere!  The benefits, though, are the purchase price, the money needed to get into the deal and get it rent ready, and ownership in 5 years.  All this, and I don't have to deal with a bank and jump through their hoops. 

Steve, it's interesting to read that none of your seller financed deals cash flow well. Our W2s are strong;  life does happen, but I don't believe we will have a problem meeting our obligation to the seller.  In terms of exit strategies, I guess we could get financing with a bank down the line if absolutely necessary.  This is NOT the goal.  We'd like to own in free and clear in 5 years.

Thanks @Steve Vaughan.  To be honest, the annual lump sum payments were my idea.  I will absolutely get a transfer of deed at closing on this deal.  No land contracts!

Thanks for your response!