All Forum Posts by: Malcolm Brown

Buying my first property subject- to the existing financing on property. Seller is the executor of original owner and has agreed to allow us to take over payments for 2 - 3  year term. With the loan in place, the seller is asking for some cash at closing. 

Details of the deal: 

 6 bed, 2 full, 2 half bath at 3,154 sqft.

We are planning on converting into a 2 - 1 bedrooms and 1 -2 bedroom apartments, which will yield a monthly income of 3,454 in rent.

Besides dealing with License and inspections for rezoning which is the project for this week, if 3,000 isn't paid to an attorney to handle these affairs, acquiring the funds to complete the rehab will be the next major obstacle. Especially since a bank has a first lien on the property. 

I am looking for any and all advice or recommendations that help us move forward with this project.  Bigger Pockets help 

Good morning BP,

I'm looking to get started on my first flip. I have currently found a couple of properties from a realtor were the numbers work. Here's the number.

4 bedroom, 2 bath, 1920 sqft

Comps give me a conservative 250k ARV, in the last 6 months, within a .50 mi radius. (One 4,2 within .25 mi sold for 260k in Sept)

 Asking price is 60k

Tomorrow I will be going to see the property and even with me looking at several properties in the career, Im still not the best at determining the rehab cost. Granted similar properties in the area I've looked at have had roughly 100k +/- in rehab. 

Here's my situation:

My first flip, so little to no experience,  in the eyes of hard money lenders. (Higher rates, which is fine because the numbers work) But its coming up with the funds to start the deal. The 15 to 20 percent of the purchase the lender isn't covering. Closing cost, hard money points, and first rehab draw. Don't have the funds to cover all of these costs!!! 

I am in need of experience investor who is willing to work with me on this deal and possibly help with some of the cost, in exchange for percentage of the profit. I have the contractors. I have the lenders who will lend to me but I need a cosigner (experienced investor) 

Is there anyone interested in helping me get my first one done?? 

@Joe

There is no deal here, on the front end. But I'm trying to figure out a way to male it work. The private lender for the mortgage will work with me, maybe if I could resume payments after the rehab is finish and use rent payments to pay the mortgage.  My refi could pay off the hard money. So i would have a 23k and 11k in debt for property, which rents could cover both. 

Am I somewhat making sense?

@leon seller didnt have insurance on the property. So no money there

Bigger Pockets, i have a situation and need some advice.

I have a property under contract that I would like to keep as my first rental or sell as a lease option.

Here's the situation:

Property was recently in a fire in which majority of the second floor was consumed. My rehab is roughly 70 to 80k, $11,000 in back taxes and $23,000 in a private mortgage. The after repair value is $120,000 with rents in the area up to $1100 a month.

The private lender is willing to work with me to help the seller and his situation. Currently mortatage payments are $335 until 2023 and the seller will be contacting the city about the back taxes to see what kind of payment arrangement we can set up.

Whats the best way to go about this?

Are there any hard money lenders that will lend on my rehab cost ONLY? Exit would be to refi out with another private lender or a bank.

Is there a way I can take over the payments, with resuming payments after the rehab,

I want  to personally say congratulations to you. I've been trying to work the business for a few months now and haven't done my first deal yet, but as I read your post it give me more motivation to keep at it. I wish you the best of luck, and I'll see you at the top!!!

Someone correct me if I'm wrong.

Buy sub2 to fix and flip or resell asap. Buy lease options and sell for option fee, but how do I buy sub2 via agreement for sale. What is the difference between lease option and agreement for sale, besides the transfer of title and the obligation to buy?

This is my plan. I would like to purchase a property, keeping the seller's mortgage in place and flip it to another investor or (if possible) to a tenant/buyer. What kind of transaction is this? And how would I set up a transactions of such? I would like a definitive answer, because I am getting confused on everything I am hearing and reading. 

Bill Gulley, it's a video on Bigger Pockets that I found on the Dood frank laws, and in it he was spoke about lease options. Maybe I misunderstood to video or maybe I explained it wrong in the post. I will relisten to the video and see if I missed something. Thanks

I am so happy that I didn't go through with that deal I had couple of weeks ago. I had a deal where I was going to be purchasing a property keeping the sellers existing mortgage in place, and calling it "Seller's financing " Smh, after further reading and training myself I found out a great deal of information. Lease options is the term that I should be using whenever I'm doing these types of deals. After further education, I've for out that lease options are part of the Dood Frank act but there are ways of doing so without breaking any laws. From what I understand, there are certain exceptions that doesn't go against the act. If an investor purchase the property from a seller, and does not  live in the property is excluded, and if the investor sell to another investor. Monthly rent paid can not go towards the purchase price, unless it could be considered an installment payment.  We, as investors, can not do more then 5 of types of deals a year. There is a great video on Bigger Pockets that covers a lot about doing lease options with dood frank.