All Forum Posts by: Michael Kussin
Michael Kussin has started 3 posts and replied 5 times.
Post: Subdividing Land near Denver

- New to Real Estate
- Denver, CO
- Posts 5
- Votes 4
I am working on a plan with a partner to develop an area, but we have never had to start from a blank slate.
In order to pitch for funding, we feel like we need to get a few basic ducks in a row. Is there anyone in the Denver area that knows the early stages for subdividing land or what professionals I should turn to in order to start collecting some basic info?
Post: Coffee and Real Estate Sunnyside Meetup

- New to Real Estate
- Denver, CO
- Posts 5
- Votes 4
Wish I saw this in time! Definitely trying to make the next one
Post: How do you build equity with Subject-to financing?

- New to Real Estate
- Denver, CO
- Posts 5
- Votes 4
Quote from @Brad Jacobson:
Hi Michael,
Yes, you've got the basic concept of buying a property subject to.
In that same example (seller's owe $50,000, you purchase for $150,000), the terms you create for the financing should have a balloon payment along with enough monthly to cover their mortgage and provide them some cashflow. It's normal to have terms of 3-5 years but they can be anything the parties agree to.
The hope is that in 3-5 years, you've forced appreciation on the property (rehab, value add, whatever) and the market has continued to push values upwards. Then, say, the property could be worth $200,000. At that point, you'd be able to secure long term financing through a traditional mortgage.
When securing long term financing, you'll be able to cash out 80% of ARV (in the $200,000 case, this would be $160,000). You'd get to keep the $10,000, pay off the seller's $150,000 (or whatever amount is owed at that point if some of the payments were paying down principal), and then be left with 20% equity in the property.
Hopefully that makes sense. Good luck!
Thank you so much - this totally helps! Funny how you just need someone to break down additional steps in a simple way and it makes more sense.
This may be looking into it further than necessary, but this now brings up more questions. Let's say the seller is an angel and agrees to a 30 year term because they want to avoid a lump sum of cash getting hit with taxes. Does this cause issues during refi? Or is that simply not my problem to worry about?
Additionally, in either situation (the one you laid out or my angel seller), are you able to take out a HELOC on any note carried by an individual? Or can you only borrow against equity with a bank?
I appreciate all the help here!
Post: How do you build equity with Subject-to financing?

- New to Real Estate
- Denver, CO
- Posts 5
- Votes 4
This may come down to not understanding Subject to as well as I need to, but I had a few questions on the strategy as it relates to payments and equity built in the property. For context, I am trying to figure out if I can use this strategy for a primary and ideally a primary that I house hack with a short/mid term rental in the basement.
1. When buying a property subject to, I understand that you are taking over the seller's mortgage payments. If you are paying off someone else's debt, how do you build your own equity in the property if the debt and ownership have been separated essentially?
2. For example purposes, let's say someone bought a house for 100k, they owe another 50k, and you buy it from them for 150k. Would you essentially take over the 50k left in mortgage payments and then create separate terms for the 50k on top? Therefore having essentially 2 different payments to service?
Thank you for any help! Just trying to wrap my head around the concept better.
Post: Wholesaler by accident

- New to Real Estate
- Denver, CO
- Posts 5
- Votes 4
Morning! In need of some advice here. After listening to an old episode of the rookie podcast, I ended up shooting a couple of messages to owners of houses listed for rent. Just to see what conversations I could have and learn more. Now I'm in a back and forth with someone who is interested in selling, but I have no idea what I'm doing, or what to do next.
My thoughts are to find a wholesaler in my market (Denver), hand over the deal to them, and sit in on it to learn. Is there a best way to go about this? Or a better route I should take this?