All Forum Posts by: Ocie Gibson

welcome to BP, I'm from Maryland feel free to reach out to me about anything in this market.

If you have some money saved starting out with hard money us not a bad idea if there is a good spread amount.  

Join wholesalers buyers list until you are able to master your marketing and get yourself a website.

i say go for it. If you want some help on the investing side look me up.

Case Study for Newbies:

Re posting because I posted in the wrong place

here is a case study of a partnership exit strategy

Two people going into a partnership. What if the house doesn't sell in 12 months this is how they will dissolve the asset. its a 50/50 partnership with partner abc  earning equity from managing the rehab. partner xyz is earning equity from bring the financing. the property will be help with xyz partner because they are bring the financing and holding all the risk

XYZ is borrowing private money

Exit Strategy
If at any point abc partner and xyz disagree on
decisions/strategy, either abc can buy the property or the
property will be kept by xyz. The property will be
sold to the highest bidder between abc or xyz

Any profits/expenses (such as closing costs) will be shared
between the two parties.

 Here is an example scenario: Total cost so far (purchase price + repairs + interest paid to xyz + insurance etc):

$60k xyz bids $70k
abc bids $80k
abc will be allowed to purchase the property.
Profit: $80k-$60k=$20k
Transfer and recordation costs : $2k
Net profit: $18k
abc and xyz each get $9k

your thoughts on this is note abc is bring the deal and assigning it to xyz. xyz is funding it and holding it in a llc where xyz is the only managing partner.

YOUR THOUGHTS AND WHAT DO YOU SEE IN THIS CASE STUDY

here is a case study of a partnership exit strategy

To people going into a partnership.  What if the house doesn't sell in 12 months this is how they will dispose of the asset. its a 50/50 partnership with partner abc is earning equity from managing the rehab. partner is earning equity from bring the financing.  the property will be help with xyz partner because the are bring the financing and holding all the risk.

Exit Strategy
If at any point abc partner and xyz disagree on
decisions/strategy, either abc can buy the property or the
 property will be kept by xyz. The property will be
sold to the highest bidder between abc or xyz

Any profits/expenses (such as closing costs) will be shared
between the two parties. Here is an example scenario:
Total cost so far (purchase price + repairs + interest paid to xyz + insurance etc):

 $60k xyz bids $70k
abc bids $80k
abc will be allowed to purchase the property.
Profit: $80k-$60k=$20k
Transfer and recordation costs : $2k
Net profit: $18k
abc and xyz each get $9k

your thoughts on this is it me or something about this exit isn't smooth.

Okay first subject to deal and i think the sister just killed it when she gave me the new payoff amount.

check out the numbers on this subject to:
$15,372.19 to catch up on the mortgage
$ 2,000k to sister to move out. amount coming backout of their profit.
$ 4,715.14 in back taxes and liens I'm going to pay up front to clear title but its coming out their profit.

purchase price $240,000k
arv 360,000
rehab 45k
pay off amount 188,320.40k

okay I'm paying 15,372k to take over loan then rehab the property for 45k then pay off the mortgage on that back end. I'm going to give the owners their profit before i rehab and don't forget 2k for cash for keys that's coming out their profit.

backend

$25,200 closing cost that's 7% of arv 360k

Tell me what you get
THIS **** GOT MY HEAD HURTING WHEN I SAW THE NEW PAYOFF BUT ITS A DEAL KILLER.

Okay Update,

I'm not going to take the property in Quit Claim deed but a Warranty Deed in a land trust.

Probate is set up and we are in the process of getting court order to sell the property.

@Dave Metsker I like your idea because I'm also giving one of the heirs 2k to help with relocating and moving out of the property.

So the trust will be setup, the ownership of the property will not change but making me the trustee, and the heirs will be the beneficiary's.   The beneficiary rights will be brought from the heirs for the total of their profit.

THOUGHTS

 @hugh C.  did you ever find a virginia attorney if so would you please share with me thanks. 

I wanted to ask some of the subject to vets here how would you structure this deal.

I have a home I'm about to buy, the owner is going to let me catch up on the rears of the mortgage which is about 12k then I'm going to pay 2 months advance mortgage payments while i rehab the property. I'm going to give the homeowner 30k for the house.

NUMBERS

MORTGAGE PAYMENTS 12K REARS 2K ADVANCE PAYMENTS

30K TO THE HOMEOWNER

While I have control over the home I going to rehab the property then I will resell it. 

So I'm thinking of setting it up like this your thoughts here are my options

1) Should I Do a Quit Clam Deed ?

2) Because its a probate property have the seller create a trust with me as the trustee, then i Buy the beneficial interest by purchasing it from the seller for 30k

HOW WOULD YOU SET THIS UP ?

KEEP IN MIND I'M DONG THIS BECAUSE I DON'T WANT TO PAY 2 CLOSING COST MEANING WHEN I BUY IT AND WHEN I SELL IT.

send me an email 

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