All Forum Posts by: Jeremy England

I've been outbid on 3 straight offers on REO properties. I was already bidding at MAO. I don't see how the winning bidder is going to make any money on the deal. These were intended as flips.

I may change strategies to buy hold, perhaps I could bid more and still cashflow. But as of right now, people want too much money for the properties. Contractors want too much money to work on them. Lenders want too much money to finance them. However, ARV has not changed much in Pensacola.

 What kind of turnaround times are you seeing on those deals?  From purchase to resell?  

Term is 30 years, 5.4 pct 

Lender is quicken loans.  I won't be financing with them, they were the first ones I called just because they carry my primary res.  

 That's a good point.  I recommend anyone with a capital one account sign up with credit wise.  It allows you to place speculative numbers in as far as debts, late payments, etc etc to deterimine what it would do to your credit score.  

Paid cash for my last 3 vehicle purchases.  2 were less than 10k, one was 25k.  The way some vehicles are built today, they will go over 300k before they are ready for the junk yard.  I drive a 2004 Dodge Ram 1500 5.7 hemi that is nice on the inside and runs just fine.  Paid 8200 for it a couple years ago.  

I'll drive it for a couple more years then do the same thing

So I looked into Sofi and got approved for 100k, 7 year personal loan at 8.6 pct.  

This is a better option than the conventional lender referenced above for sure.  I'll have to compare it with some other lenders.  for this particular deal it would decrease buying costs and cash outlays, but nearly double holding costs since the loan payment would be like 1600/mo.  Conventional lender I come out of pocket for 25-30k to get the property.  This would mean I come out of pocket zero and the cost of closing would be equitable to an all cash deal

Assuming I carried the property for 6 months before being sold or refinanced, that's like 10k in debt service, however since you are paying principle, nearly half of that gets deducted from the original 100k  Making the loan payoff approx 97k vs 100k.   

If one is to use this for real estate, the way I view it is it increases your holding costs but decreases your buying costs, and limits the amount of cash you need for a purchase requiring all cash

Ok, so the lender is trying to charge 3550 in origination charges, and then consider the prepaids are 1997 (which most would come back to me when I sell),  so that would put this loan more in line with normal.  The lender is the problem.  

I've never borrowed from a hard money lender, what fees are typically involved?  

Do they do an actual appraisal or is it based on a bpo?  Do they charge the same miscellanous fees that this lender is nickel and diming me for?

 wow, never heard of that, but I'll be looking into it because I think they could be a good option for me.