All Forum Posts by: Jacob Wadkins

BP, I live in an area immediately outside of Jacksonville, FL that is growing very rapidly. There has been a major uptick in property development (single family neighborhoods and multifamily apt complexes) permit applications. I'm unsure of where all the people will be coming from to support (and live in) such an increase in development. I'm concerned there may be a glut of housing in the not-so-distant future if all planned development actually is constructed and there is no MAJOR driver for an increase in population. Does anyone have experience with such a rapidly growing area? If so: 1. What are some surefire ways to profit from such growth? 2. How do I hedge against an oversupply of housing if I'm looking to invest in small multifamily units (or is this even a valid concern)? Any insight is appreciated!

Alright so it took a little more time than I expected to get this information, but below is what I've gathered:

3A. The amount or percentage for earnest money (aka "binder") is agreed upon between the buyer and seller, but it is generally around 1% of the purchase price. This binder has stipulations attached and will go towards the down payment at closing, but if it doesn't close the Owner could be granted the money.

3B. The Owner typically selects the title company and they would open the escrow account as well. In this case, it would be up to me, the buyer, to select the title company and open the escrow account.

4A. The  buyer will pay for the appraisal through an escrow account with the lender, but the lender will actually schedule and disburse the funds for it.

4B. There is little if any difference between closing times on an FHA vs conventional mortgage loan. It takes approximately 30-45 days.

I also learned that closing costs would be approximately $5,000 depending on the purchase price. 

If this information is any different than what you'd expect, let's discuss!

I couldn't agree more, and that's the plan @William C.. I am meeting with a lender this afternoon and will hopefully be able to provide answers to my own questions tonight. I'll post here for anyone that may read this thread in the future.

Thanks so much @Todd Miller I have a few additional questions for you. In regards to your points 3 and 4: 3A. Who decides the earnest money amount? Is this between me and the Owner? What is a standard/reasonable percentage of the total purchase price? 3B. Would I be the one to open the escrow account, and can this be done with the title company of my/our choosing? 4A. Who pays for and schedules the appraisal? Is this part of the closing costs? 4B. How long does it take to close on a traditional mortgage vs a FHA loan? I appreciate your help in clearing these questions up for me!

Hello all!

I'm trying to get my first deal under my belt via a live-in-flip in Jacksonville, FL. I've done TONS of reading on BP, the internet, and books, and I believe I'm ready to take the plunge. I have been scouring Zillow and Realtor.com, and I've been working with an agent with access to the MLS to find my first deal. I've found a (possible) deal that is currently in pre-foreclosure.

After some internet searching, I've determined that a Lis Pendens has been filed so it is early in the foreclosure process (per this thread: question-about-the-foreclosure-process-in-fl). From the reading I've done here on BP, I understand that I could make an offer for the pay-off amount to "save" the Owner from being foreclosed on. I'm interested in doing this, but there is currently not an attorney listed for the Owner so I will need to try and contact them directly.

I have a few questions for you experienced investors out there:

1. What is the best way to go about dealing with pre-foreclosures and Owners that are being foreclosed on? Should I mail a hand-written letter explaining that I'm interested in the property, or is there a better (more efficient or effective) means?

2. Once I've established contact with the Owner, he/she is interested in selling, and I've done a walk-through and am still interested, would the next step be to request the pay-off amount be provided by the Owner from the lien-holder?

3. After further analyzing the deal and I'm ready to make an offer, could I make an offer contingent on a home inspection (which would verify if my deal is still worthy or if I should modify my offer)? Would I need to or should I open an escrow account before or after submitting an offer?

4. How does a bank analyze the value of a property in order to provide financing for such a deal? Must it be appraised (or just inspected) before issuing a loan?

Are there any steps in this process that I've missed? Any other issues or concerns to which I should give consideration?

Any help or education is sincerely appreciated!

Kind Regards,

Jacob Wadkins