All Forum Posts by: Lee Moseley

All, I was approached by GEG way back in 2013/14 (still have the Offering Memos). I didn't buy as the  product seemed quite high priced for the markets, their "proposed" (never saw rental agreements for "actual") rental rates were also high (hence the lowering over the years, when it should remain stable or go up). Their Annual Income didn't add up to the Rent*12 on their sheets, and didn't include Condo Association Fees. Seemed like they were selling properties they were "flipping" and financing. Well, it's been 5 years, and I checked those same properties (2 of 4 areas/properties, Bridges and Timberwoods), and they are worth FAR less than they were being sold for, when most property went up, so selling in 5-6 years would NOT have made $$, but would have lost. As with Buy & Hold, you should have a Positive Cash Flow (specially with 50% down) and Build Equity (or try to pay off within 15 years).  You don't want your IRA being bled down by Negative Cash Flow! And equity build up (paying off) will accelerate returns down the road or allow you to sell/exchange for larger properties (move from single to duplex/tri/fourplex to 5-20 Units, to 100's of units, etc.).

Also on a note regarding Value (determining), as a Buyer, I ALWAYS have a professional appraisal done & paid for BY ME (sorry, but I don't trust sellers/owner/agents or their appraisers, and certainly don't trust "Market Analysis", except for "ball park" values! As stated Due Diligence, Due Diligence, Due Diligence!! 

I would setup the LLC for the next place you are going to purchase and buy the next one via LLC. Possibly even a Self directed IRA (Roth or standard real estate) then it owning the LLC or moving to an S-Corp if you are planning to get many more. You'll need to weigh the advantages and number of properties and get all the legal lined up. It is a lot of up front work, but after a few properties in your name, the Schedule E max is reached or the max loans is reached and you are exposed to a lot of liability.

It also depends on your net worth (what they can sue you for). Make sure you have a large umbrella insurance policy to cover those if you keep it in your name.

I'm not familiar with California laws (never having to evict my California tenants, luckily).

I highly recommend the process server (or stand in if allowed) and work the eviction through the courts. Also take pictures of any property left behind to document condition, as they may claim you damaged it and try to get reductions from what they owe. You should re-key the place and re-code the garage openers (charge them for it, since they didn't return them - I have a clause on keys/openers/re-keying in my lease).

On a side note, the date/time of their text (saying they're moving out) may be allowed as their 30-day notice and the judge may go off that date/time to speed up the eviction.

Thanks for the information. David, I always use an Escrow Company, I just wasn't sure if they (WestStar or Security) had lawyers to review and help write up the docs.

Thomas, I'd love to talk more and see what you have. Please let me know where/when and I'll see if I can make it.

I am helping a friend put a deal together, and it's been a while. He is purchasing a house (SFR) for $270k with about $9-10k down, the seller is carrying a 2nd wrap/note (1st is standard mortgage #217k balance @ 5%, PITI $1690). 2nd will be about $300/month PI. My friend plans to refinance after his credit clears up in 6-12 months. I will probably purchase the Note after Escrow

What are the contracts (samples available) to use again? REC, Note, Note purchase?

Should all the details be done by a lawyer or can the Escrow Company do most of it?