All Forum Posts by: James G.

@Jordan Williamson

I think it may depend on how complex would you like to make the calculations. Unlike a typical flip, as you mentioned, you will have tax advantages as well as subsidizing a place to stay; additionally, you may be able to use an FHA 203k loan which may likely be the best source of funding. I would analyze it just like any other flip, like Josh said. Don't want to overpay on the going-in price or over renovate just because you are going to live in it.

@Nat C.

 @Carlos Rovira

Thanks for the responses! It's good to hear others that run into similar issues. I have noticed anyone and everyone in South Florida thinks they should get a real estate license; I would be a proponent of making it much more difficult to et a license, maybe resulting in individuals getting a license as a career choice, not a weekend whim.

@Billy Runyanvalid point, thanks!

@Wayne Brooks Great thoughts, thanks!

As @Andrew Bosworth mentioned, this is a dated post, so I don't want to belabor the point, but I wanted to give an appraiser's perspective.

An appraiser would not only utilize the sales comparison approach, they would also look at the income capitalization approach. I agree the prior listing would be a red flag; additionally, any good appraiser would not be 25% higher ($20,000/$80,000) based soley on a recent sale price. Also, an appraiser would ask if the prior sale had any Conditions of Sale (which includes a seller credit) and not disclosing the $20,000 credit would be fraud.

@Eric Odumand @Joel Owens

Great thoughts! Oddly, I meant to mention that, on occasion, I've tried to contact the listing agent before submitting the offer for the purpose of having them represent both sides of the deal. But, no responses. I think you are right, these low-end agents are getting a high volume of listings.

@Billy Runyan

 Maybe I should look into reporting the agent, but I'm not sure its worth the hassle. 

   @Chris MartinThank you, very helpful!

@Jeff Rabinowitz

Interesting thoughts, I appreciate your response. I would definitely like to abstain from requesting a preapproval letter from my investors. I'm gathering from the responses that I shouldn't include any POF or preapproval letter with my offers. My only issue with this is that when submitting offers on short sale properties, the seller's bank usually requires evidence of funding.

I imagine your rehabbers are experienced and have a personal LOC or POF for their offers, but they probably didn't start with these on their first deals.

@Jeff S.

Thanks for the response. I'm aware of the "game" of making cash offers, then utilizing financing; however, in my market, if you make a cash offer the seller wants a POF with your account info. Therefore, I use the Florida contract that indicates that the offer is not contingent on financing.