All Forum Posts by: Laura Johnson-Morris

I just closed on my first property in the Denver area a couple of weeks ago and am doing the house-hacking thing!  It's a duplex, and I live in one side with my husband, baby, and dog, and we are renting out the other side.  I'm excited we were able to take the plunge and get started in real estate this way!

Hi all!

I'm working on a deal where the seller is willing to finance 30% of the purchase price (purchase price of $118,000) and I was hoping to get a conventional loan for the other 70%. Does anyone know of any bank or credit union that will lend on these types of deals? I'm in Boulder, CO. Let me know, thanks1

Laura

Hi Jerry!

Great advice - thank you so much! I just had another one of these pre-foreclosure situations call me and I'm looking forward to using the sub 2 solution with them.

Also, your website is great - especially the sample letter you provided!

I was hoping you might be able to answer a few more questions for me - here's what I'm still wondering:

1) Do you usually set up a balloon payment in the contract, and if so, how many years/months down the road? Also, if you use balloon payments, is it easy or difficult for the buyer to refinance, and are there any tricks to doing so?

2) You mentioned that when you find the buyer, you want to take a sizable non-refundable deposit. I've heard for standard wholesales that you should take $2000 or so of your $5000 wholesale fee as a non-refundable deposit. Does this sound right to you or would you do it differently?

3) Any tips or tricks you use to qualify buyers?

Thank you!! I'm really nervous because I just got off the phone with a seller who wants to meet this weekend to look at her property. I feel way in over my head but I am very appreciative of the seasoned veterans on here that are helping out!

Thanks Jerry!

I think my seller will sell for what they owe...they are tired landlords about to go into foreclosure and just want to avoid the credit crisis. Do you think I could sell this property to an investor or are you speaking of the retail market? I'd be more than happy to sell it at $300,000! Just am not sure who to be marketing to.

Thank you - I really appreciate the experienced investors on here that share their wisdom with us newbies. I hope the karma is treating you well!

Hi all!

I have a direct mail campaign out to homeowners in pre-foreclosure, but I'm finding that even when homeowners do have some equity in the property, it still doesn't help the homeowner if I offer 65 or 70% of market value in cash.

One example - I just heard from a homeowner with a house in pre-foreclosure worth about $320,000 (based on my comps). The homeowners owe $266,000. If I offer 65% of market value (~$208,000), they would still need to bring almost $60,000 to closing, which they can't do.

So, my questions are:
1) Does anyone know of strategies that would work in this type of situation? (owner financing options, subject to, etc?)

2) Are any investors buying properties that are a certain dollar amount under market value (ex. $50,000 or more under market value) instead of a percentage (30% or more) under market value?

Would love to hear your thoughts - thanks!
Laura

Hi Dale!

Thanks for the suggestion - I'll be sure to check that out!

I recently moved to Colorado from Michigan and have been amazed at how everything has built up around here and continues to do so! It's a pretty interesting market to be in and I'm hoping to learn more about it.

I'll check out the book and keep you posted - I'm excited to learn more!

Thanks for your speedy responses! I've been going over and over this situation in my head since I'm brand new at this and really couldn't think of any solution I could provide that would really work for this seller.

In these situations, do you just make the low-ball offer anyway and then thank the owner for contacting you if (when, haha) they say no? I don't want to unnecessarily offend the seller because I'm sure they can't accept that offer but on the other hand, it doesn't hurt to throw it out there...right?

Thanks all!

Hi everyone! I have recently set up shop in order to get into wholesaling and received my first call today from a motivated buyer! I'm hoping some of you can help me evaluate this situation and see if wholesaling is an option. I'm aware that the seller is considering other options, but hasn't listed with a real estate agent, so my guess is that I'm competing with other wholesalers.

She paid $259,800 in 2001 for the 4 bed, 2.5 bath house, which was brand new at the time (She's been the only owner). She then put about $60,000 in improvements in the house. She has been renting it out since 2007 and has had bad experiences with tenants, so she wants to sell and get out of the landlording business.

I've comped the house, using 13 properties within a half mile that have sold within the last year. From that, I figure her house is worth about $185,000. From what she says, it is in good structural condition but needs cosmetic improvements (paint, maybe some carpeting) from bad tenants. I'm not sure what a good repair estimate is since I haven't seen the house yet - what would you estimate based on that information?

My thoughts are that a cash offer would be ARV x .65 - repairs, so $120,250 minus, say, $5000 for repairs. Cash offer = $115,000

She won't disclose the balance on the mortgage because she said "no one else is asking for it" and her husband doesn't think it's necessary. The info I do have is:

Initally put 20% down
Refinanced last year at 4.75% fixed for 30 years
Monthly payment is $952 (if she indeed has 30 years left on the loan, my guess is that the balance is $183,500)
Annual taxes/insurance is $1800
HOA fee is $49/month
Has been able to consistently rent it for $1500/month with tenant paying utilities

From that, it looks like someone taking over payments could rent it out and make $4078 annually. Could this be a subject to?

Other creative options for how to wholesale this property?

Thanks in advance!

Hi Troy!

I'm new to investing, but I went to the IRR wholesaling seminar this week and found it helpful. I'm also hoping to check out some of the BCREI meetings. They seem to have good monthly topics. Perhaps I'll see you at one of the meetings!
--Laura

Hi everyone!

I'm really excited about this site and the opportunity to network with investors in the Boulder/Denver area. I've been to the most recent IRR wholesaling seminar, and I'm hoping to attend some of the Boulder BCREI meetings.

I've just received about 500 postcards in the mail that I ordered (basic wholesaling "we buy houses for cash" postcards), and I was wondering if anyone has any other marketing suggestions for finding wholesale properties in this area. I'm thinking about sending these to pre-foreclosures or about picking a low-income area and sending them out there. Any ideas would be super helpful - thank you!

Laura