All Forum Posts by: James Smith

Hello,

My friend wants to sell me his house subject to. I understand that I will make the payments on his mortgage. I also have experience buying houses and taking the deed to the county office to record the transaction.

What I don't know:

1. How do I make the mortgage payments? Do I logon to his servicer's website and put in my bank info?

2. Do I need a new insurance policy in my name?

3. When the 1098 is generated in his name, how do I report this to the IRS?

4. I've heard Pace Morby on Graham Stephan's podcast say that he sometimes will hold the physical deed and not record the transaction with the county. Should I record the transaction?

I'd love to speak with someone that has done Subject To transactions before.

Thanks! :)

-James

Hey @Ian Jimeno I appreciate it! Ya! For a 3/2 house between 1300-1600 sqft in good condition, $1500 is a conservative estimate for rent. :)

Investment Info:

Single-family residence buy & hold investment in Tallahassee.

Purchase price: $169,000
Cash invested: $42,475

This property was my first investment deal. It was a base hit! It sat vacant for a while because I listed it in February, and might have over priced it. It's rented for $1500 and the PITI is $787. The tenant is reliable, but a little high maintenance. Good problems to have!

This property is in Tallahassee, and we've seen appreciation! Different websites estimate between 5% and 10% appreciation in a year! Fired up!

Really cool! Ya, it makes a lot of sense for employers to pay their employees rent for tax reasons! 

Thank you!

@Ryan Chatman it was the concrete company that Amazon contracted! It's called Eco Pan. The company sent me the check, and I drafted a lease to the individual living in the house! :)

Investment Info:

Single-family residence buy & hold investment in Tallahassee.

Purchase price: $185,000
Cash invested: $46,250

This is my best deal! The agent under priced it and within an hour of it being listed, I had a full price offer in. Get this, I had an escalation clause that said I was willing to pay $1K over the highest offer up to $200K. I ended up only having to pay $185K. I listed it for $1700 and I got $1850 because Amazon is building a new warehouse in Tallahassee - they wanted to put their #1 guy in my house! They also prepaid six months rent! Fired up!

Investment Info:

Single-family residence buy & hold investment in Tallahassee.

Purchase price: $175,000
Cash invested: $43,750

This is the home right across the street from where I live! My neighbor heard through the grapevine that I buy RE, so she sold it to me off market! It appraised for $179,000. I was able to give them a hassle free selling experience as they upgraded to a larger home in a less busy area! It was a win win! Got it rented out immediately to a great young couple for $1550.

How did you find this deal and how did you negotiate it?

My neighbor across the street from me heard that I buy RE!

How did you finance this deal?

Nick Hague from Loan Depot!

How did you add value to the deal?

I bought it turn key! Replaced a few light fixtures is all!

Investment Info:

Single-family residence buy & hold investment in Tallahassee.

Purchase price: $169,000
Cash invested: $42,475

This property was my first investment deal. It was a base hit! It sat vacant for a while because I listed it in February, and might have over priced it. It's rented for $1500 and the PITI is $787. The tenant is reliable, but a little high maintenance. Good problems to have!

This property is in Tallahassee, and we've seen appreciation! Different websites estimate between 5% and 10% appreciation in a year! Fired up!

What made you interested in investing in this type of deal?

I understand single family well. I also am very comfortable with the financing of single family deals!

How did you find this deal and how did you negotiate it?

I found it on the MLS! I actually got a $3500 seller credit after the inspection showed some repairs. I think the previous owner was rehabbing and ran out of money! Score!

How did you finance this deal?

Conventional Mortgage with my guy at Loan Depot. 25% down. 3.625% interest rate!

How did you add value to the deal?

I just got it ready to rent! Finished a bathroom and put up some shelves. Very basic stuff.

What was the outcome?

I have a very reliable tenant who pays almost double the PITI!

Lessons learned? Challenges?

I probably should have listed the property for rent while we were under contract. I initially priced it at $1700 which was too aggressive at the time. I think I could have avoided a couple vacant months if I priced it more reasonably!

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Nick Hague from Loan Depot and Bruce Foster from the Big Bend Group! Give them a google!

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $239,000

I currently live in the house and have an Army friend living with me. I used the VA loan, $0 down, I even got the closing costs in my loan. 2.75% interest rate. My buddy pays me $300/month and takes care of the utilities and WIFI.

What made you interested in investing in this type of deal?

I knew that I needed to get my foot in the door, so while I was in the barracks at Fort Bragg, I bought the house without even seeing it first! Wasn't in great shape, but the PITI is only $1187, should rent for $1900. Purchased with no money down!

How did you find this deal and how did you negotiate it?

On the MLS! I said I'd pay full ask if they covered some closing costs!

How did you finance this deal?

VA Loan! I was able to finance some of the closing costs into the mortgage!

Lessons learned? Challenges?

I'm so happy I listened to the Beard and was okay with hitting a base hit on my first deal! Created momentum!

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Nick Hague from Loan Depot is stellar! He can do any agency loans in Florida!