All Forum Posts by: Kevin Lee

This is a complex situation but my mom is trying to purchase my unlces home since it's a few miles from my home in a HCOL area. She's purchasing it for below market value since it needs a lot of work. The house is being bought for 680k (likely worth around 750k) and there is 250k left on the mortgage at 2.75% rate. Not a true real estate deal because no title change, only adding name to title and mortgage.

Her plan is to give her 400k, add her or my name to the title/deed and then add my name to the mortgage since it is not transferable. She wants to do this to take advantage of the low mortgage rate and extremely low monthly payment.

We plan to add new kitchen, floors, paint and windows. I know this is the worst method to use 450k and there is a better method. We appear to be doing the BRRRR method without any of the benefits.

Also, would it be advisable to add my name or my moms name to the title? I was told that if it was in my moms name, the house would be an inheritance to me and there would be no tax implications. Or could I put it in my name to avoid estate/probate issues in the future.

Thanks!

0 Votes

Quote from @Noah Corwick:

Quote from @Kevin Lee:

Quote from @Noah Corwick:

Hi Kevin!

In my experience, a lot of new builds here in the Valley offer a 2-1/3-2-1 buy downs instead of a fixed lower rate. I would confirm with the developer's sales team on how the terms break down. Also there are also annoying hidden/inflated fees when working with a developer's preferred lender that are "fun" to work through.

Also make sure you work with a developer who is trusted, well regarded, and has great reviews. I know it's a "no duh" thing to point out, but new builds can be troublesome construction wise sometimes.

The area will be key as well, as there are a lot of new builds in AZ that are in locations that will take time to appreciate. It certainly can be worth the wait, but you have to be able to mentally and financially budget for this and plan accordingly.

Overall I believe it's definitely a route worth with exploring, but obviously will be reliant on how the numbers look.

Thank you! Makes a lot of sense. Would you happen to know anything about Lennar and the San Tan Valley / Queen Creek?

You're welcome Kevin. Lennar is not regarded very well.

Here are some reviews I found online as examples: https://www.consumeraffairs.com/homeowners/lennar-homes.html...

A lot of these are from customers outside of AZ, but the experiences are likely to follow regardless of state.

Thanks so much for your input. This is what I gathered as well but one realtor I was speaking to said they use them because they are reputable in that area. Thank you again!

0 Votes

Phoenix, Arizona

Quote from @Noah Corwick:

Hi Kevin!

Overall I believe it's definitely a route worth with exploring, but obviously will be reliant on how the numbers look.

Thank you! Makes a lot of sense. Would you happen to know anything about Lennar and the San Tan Valley / Queen Creek?

0 Votes

Phoenix, Arizona

Hey all! West coast out of state investor here looking to purchase my first rental. I've looked at a lot of resales and with the high interest rates, I'm wondering if I would be better off purchasing a home that is new construction that offers "5.xx% fixed 30 year rates and 10k in builder credits." I was looking at the Queen Creek / Phoenix area.

I know this is not a BRRRR and won't make that crazy return on investment, but if I'd like to build equity and if I can cash flow $100 a month, that would be ideal.

Any thoughts or criticism would be greatly appreciated. Thanks!

2 Votes

Phoenix, Arizona

All Forum Posts by: Kevin Lee

Kevin Lee has started 2 posts and replied 4 times.

Post: Advice request: I'm doing it all wrong (BRRRR)

Post: New construction with lender incentives?

Post: New construction with lender incentives?

Post: New construction with lender incentives?