All Forum Posts by: Account Closed

It really depends on how much the private investor has to invest and what his goals are. If it is enough for one property, I think you use his cash, you do the work and then flip the property and split the profits 50/50. If he can do 10 to 20 properties, I would look for "Subject To" deals and do as many as you have money for, using his cash. You do the work and the two of you split the cash flow. That is what we do with our investors and is what we teach.

You appear to be talking about a Wrap, not a Subject To. Have your closing attorney draw up a Wrap Around mortgage to protect your interests. There are servicing companies that you send your payment to and then they send the payment to the bank with the difference going to the seller. You are on the right track, but I think you will need help to get this completed. These are the kinds of transactions we teach.

Hi Tyrone, do the transaction first. When you get one under your belt, worry about the LLC. Don't do foreclosures in Washington, they changed the law where it is now illegal to even solicit foreclosures.

Seriously, you are partnering with an attorney? I hope he is a very, very good friend or maybe a brother. ;-) I use real estate attorneys for my transactions, but I would be crazy to use one as a partner. He holds all the cards and can sue you if things go wrong. Think it through. (no bias here, just been around the block a time or two. Lol)

We work with equity lenders.  

A debt lender gets paid a payment as agreed in the contract but when you go to sell they don't get any of the profits from the sale. It is like a bank, as you say. It is a LOT harder to "qualify".

An equity lender puts up all of the cash in our case, we find, buy and manage the property and then when we sell the property we split the profits 50/50. If the deal is good, they will jump at it.

It's best to run the numbers on the transaction to see which is better for what you want to do. Most debt lenders won't lend to you if you can't service the debt "make the payment". That means you run out of options for the number of transactions you can do. Usually 4 to 6 total.

Equity lenders don't care since they are responsible for all cash needs and are aware of that going into the deal. They get a high profit, but you can do as many deals as you want. This one is far better for building wealth. (That is what we teach by the way.)

I would follow the Lease agreement and if it is not specifically stated, I have the responsibility.

Buy a copy of TurboTax and enter the numbers as they require. That will be the closest answer you will get outside of hiring a CPA.

Hi Nate, Leases are state and city specific. Your best bet is to talk to an eviction attorney in the city the property is in. It will cost you $100 but that will be the best $100 spent on the whole transaction.

The Real Estate Attorney in Austin that I use for my Central Texas deals, is also an Investor that insists one LLC is all you need until you get really good. Find the deals, close the business, then worry about LLCs. You can move properties into and out of LLCs. This isn't engineering, it's Real Estate. Don't over think things. 80% of people never get started because they can't think up a dad gum name for their LLC. name it "I Was An Engineer Now I Am An Investor" LLC and book the business. ;-)

Depends, who is going to rent it and how much are they willing to pay? Do a google search on that one. It is not what these investors normally do.