All Forum Posts by: Jonathan Miller

I found a FSBO in South Jersey who owns a 3/1 SFH rancher free and clear. All utilities are electric (no gas, no central air). Property has a one car driveway and has W/D included. The home is in a C area. Property is in good condition and rent ready.

She's asking $75K. The reason she is selling is because it was her fathers house and she doesnt live there anymore. She used to rent out the property but had to evict the last tenant and on top of that she is disabled, making it difficult to maintain the property. 

I believe I'm in a perfect position to acquire the property using seller financing, which i have a few questions regarding. Before I go into what I think I should offer, lets get into the details:

Comps/ARV w/ central air: $115K rowhome. DOM: 9 days

 $146k rancher w/ +200 more SF. DOM: 21 days

Rents w/ no AC: $1300/month (no driveway) tenant pays all utilities. DOM: 28 days 

 $1450/month (2 car driveway, rancher) tenant pays all Utilities. DOM: 48

Expenses (Annual) 

 Taxes: $2,643=^ $3,000 

Insurance: $1,200 (estimated)

**42% Gross Rent: $6,552 =^ $6,750

Total Annual Expenses: $10,950

**(Property Management 13%, CapEx 9%, Vacancy Rate 8%, Repairs 7%, Misc 5%)

Monthly Expenses: 10950/12= $912.5=^ $915

In order to determine what the maximum monthly amount I can offer the seller I subtract 1300-915= 385. I want to cashflow at least $175 per month, thus 385-175= $210. I can offer her $210 per month, conservatively speaking. I am meeting with her this Friday and I believe I can offer her a low down payment (no more than $4k) and finance the rest with her. 

Question 1)- If we agree to the terms on Friday, what paperwork will I need in order to solidify the deal? 

Question 2)- While i was writing this, it appears that this FSBO is listed with an agent on the MLS. How will this potentially jeopardize my deal??

3 options I'm willing to offer her:

1) Full asking @ $75k w/ $2k down. $73k @ 30 years =  $202.7 =^ $205/month (call the round up good faith interest) at the end of 30 years the value of the loan will be $76,800. 

2) Offer $65k w/ $3k down. $62k @ 25 years = $206.6 =^ $210/month At end of 30 years the loan payoff would be $66k

3) Offer $65k w/ $4k down. $61K @ 30 years = $169.4 =^ $175/month. At end of 30 years the loan payoff would be $67K

Once I meet with her Friday i'll get a better understanding of what her financial needs are and hopefully we'll be able to help each other out.

My exit strategy:

1) Buy and Hold indefinitely while cashflowing at least $175 per month, using the reserve funds to ultimately rennovated/modernize the property and install central air, increasing the appreciation.

2)Lease Option w/ non refundable down payment. I believe this property would be a perfect candidate for a rent to own situation. I would screen potential buyers asking for a non refundable down payment of no less than $5k. The property would be marketed as "Rent to Own, $1,000 per month" for 10 years which equates to a property value of $120K. By finding rent to own buyers, not only would I receive immediate cash in the form of a non refundable down payment, my monthly cashflow would increase because the new "owner" would be responsible for the taxes and property upkeep. 

Question)- If I am seller financing with the original owner and I am now the "owner" while paying the note, can I still bring in rent to own buyers and set up a lease option even though i'm still paying off what i owe her?

Please give me the best advice possible;

I am 28 years old and have been a full time Realtor since 2013. My mother fell ill, and since 2015 i've been her caregiver. She and I live in a home that is paid off (270k in value) without any other debts other than utilities and entertainment, I also have stock in Honeywell that is valued currently over 19k.

The last two years I have been a full time Realtor in my market. I have had multple transactions which has helped me identify the current market value. With my mothers health on the decline, I have not been able to work full time. 

My mother and I planned on diversifying the honeywell asset into an FHA 203K on a multifamily (4plex) with the loan paying repairs as well.

With complete equity in our home, i was also thinking about using a HELOC on the property to help promote a positive cashflow on other properties,

I want to show my mother a life she deserves before she passes on. Please help in giving me advice on what we should do to best utilize our capital. 

Questions:

Can people on disability create an LLC without penalties? I.E.) Can someone on disability create a business entity while disabled and not working?

Will my mother and I be able to buy properties with her good credit? She and I were planning on marketing to multifamily properties and using a FHA loan for a year then refinancing after a year of seasoning.

  Please give me constructive criticism and not hateful messages that I've been subject to.

Hopefully second times a charm,

Jon  

No, this is not an African Scam. To be more specific, my mother is dying and I am not asking for hand outs. I am asking for opinions as to what you would do in order to solidify the family fortune. I do hope that the people that were quick with a snarky answer, respond to my question with sincerity.

If you feel that this is a spam, you are wrong. I am not asking for  monetary contributions, just fiscal advice. 

To give you more perspective;

Caregiver for my mother and grandmother. I have helped my mother with family debts, converting them from debts for assets ( paid off monthly). If it were not for me, my mother would be in debt. I have helped her to stay out of debt sine the fall of 2015. She does have a positive DTI and I make sure that debts are paid off every month.

My goal;

Buy and hold properties to a point where DTI is surpassed while maintaining a positive cash flow.

Again, I do not need spammers, molesting my thread. I am here just for advice and opinions relating to the future of my mom. 

Thanks, 

Jon

Hey all,

My name is Jon, I've been a member on BP a littler over a year now. I'm reaching out to anyone willing to hear my story and give me sincere advice. 

A little about me: I've been a full time Realtor for over the last two years. I have been oportuntistic to facilitate my mother as well as grandmother. My mother has stage 3 lung cancer. It has spread to her brain, reducing her functions. Before her memory started going, we agreed to purchase a real estate property and start a real estate empire. She and I decided that we would purse treatment. She has perfect defense that would help. We have perfected a treatment that would improve the outcome of future comrades.

Please give me the chance to help my crew. Whatever the outcome may be, we will facilitate rescue operations with Bravo. 

Whatever needs to be done, it will.. Please help me in curving the way too success. 

The review:

250k+ in equity, while paying off debts

20K+ in stock value that is willing to go to invest.

40K in investments...

______

Please Reach Out,

Jonathan Miller

ERA Statewide Realty

It's been a while @Andrew Herrig

 since your last update. How are things going with your marketing and deals closed?

Hey @Sidney King,

Any update on your mailing campaign? Hope it's starting to work out for you. I just started my very first mailing campaign out to absentees in my target market so i'm curious as to how you're doing. Let us know any news.