All Forum Posts by: Mushfiq S.

@Jorge Lago also based ouy of Seattle with 14 doors in JAX. Closing on MFH there in early May. Would love to connect and hear more about where you invested in JAX and the numbers. Congrats!

@Steve Hall thanks for the ideas.

The first lender is claiming they are entitled to interest payments and their principal. My research has showed that if property sells for a good price, any leftover funds after primary lender gets paid would come to me since I own the secondary note. He would not get interest payments before I get paid. Does that sound right?

I definitely won't be doing secondary notes again. Big mistake.

@Joshua Espejo

My property manager takes 50% of late payments.

I would also ask them if the have coordination fees. My pro pbmanager charges $15 for each 15 min they spend for coordinating contractors or doing any work related to the property. I find this cost ridiculous.

I would like to clarify as my last message came out completely wrong.

Cash Flowong SFHs are definitely available. I see them daily. I own 6 other units that are SFHs that follow the 1.5%+ rule and in similar areas to the one above. I am happy with those and were purchased after I got the property in question. I've learned a ton after my acquiring this first property. I am finding MFH off market and on market that have better numbers. I am extremely bullish for JAX. I am under contract on a MFH right now.

The one in question was my very very first property through Roofstock. Roofstock does inflate sales prices which is wrong.

Just trying to figure out if I should prune this underformer in terms of cash flow from my porfolio and potentially take a loss.

@Jack Bobeck Do you mean starter SFHs for owner occupied homeowners? I believe this to be correct. However, in JAX, cash flowing SFHs is no longer viable. Prices have increased too much and the 1% rule does not work.

@Ryan Robbins Thanks. I have contemplated the lease idea which I will do. However, that's only if a renewal is on the table, which I am not sure. As for valuation, I have received a valuation from Roofstock and my realtor so I am good there. Thanks!

My first SFH was in Jacksonville and was purchased via Roofstock. The property was my first out of state investment, and it taught me everything I know. Since then, I have purchased mostly higher CoC units, and multifamily units. While the property performs well, I am in a sort of dilemma (sell or keep) on what do with it since I am shifting focus to MFH going forward. Details below:

1. Purchased Nov. 2016 on Roofstock for $90,000
2. Loan was at 20% down at 4.375% (great rate!). Current loan amount is $69,146
3. Rented at $993 on a 2 year lease ending in Dec 2019
4. Upgraded the roof in Jan 2019 (cost $8,000)
5. Cash flow after all PITI, reserves (20%), vacancy (5%), prop management (10%) is $171/mo

Here is where I am having trouble with and mistakes I made with this:

1. My entire 2 year cashflow and reserves are gone based on an $8,000 roof repair. Back to square one.
2. Lease will end in winter month (i.e., Dec 2019 to Jan 2020). Tenant has been in place for 3 years now. They have not stated their intent to leave (too early now)
3. If tenant leaves, I am left with a vacant property in the winter months and may be difficult to get it rented
4. Expecting to spend at least $1,000 on turnover it tenant leaves. I do yearly inspections so I know property is in overall good shape but of course, basic wear & tear will happen

What should I do?

1. Sell? With realtor fees, and slight appreciation from $90,000 to maybe $100,000 price point, I will not be able to recoup my roof repair costs. I will be able to get back my downpayment though to reinvest into my next MFH.
2. Hold on to it? That comes with the risks and extra costs I've outlined above

While this is not an underperforming property (mostly it was me underperforming while I was learning the past 2 years of the ins and outs), I am shifting focus to MFH and thus I do not see this property long term in my portfolio (unless I am convinced otherwise). I am not hard-pressed for funds nor do I live off any cashflow from my properties.

What would you do? Thanks for the help!

Looking for a lawyer that can look over a situation I am in as a second note holder in a property. Borrower has failed to keel his end of the deal by doing a fix & flip. Primary note holder wants to take over the property via a quit claim deed and wants me to do a quit claim to him. If I don't agree, he will foreclose.

I want to know what my plan of action should be. Really looking for some help here from Florida attorney.

Let me know if you can advise. I have all documents.

@Mr Davido should have mentioned. I did this agreement via my Solo 401k. I cannot buy the property myself due to lack of funds.

Any other ideas?

I am in a bit of a situation and really looking for some help. The property in question is in Florida.

Here is the situation:

• Fix & flipper (Borrower) pitched me on 09/2017 for a property acquired for $72,000 off market for a fix and flip
• He had a first lien holder that paid the $72,000 as primary lien holder
• I was to provide the rehab loan of $10,000 and would be the second lien holder via a mortgage note. The structure was a $10k principal payment, and I would receive a fee of $1,000 after completion. This should have been paid out 11/2017
• The primary lien holder is frustrated due to long delays (so am I) and has issued a Default Letter to the borrower that he wants to foreclose
• Borrower has said he is willing to do a quit claim deed on the property to relinquish rights
• Primary lien holder is now reaching out to me to ask me to do a quit claim deed and he would pay me $1,000 for that
• Primary lien holder is saying that if he does the foreclosure process, I will be left with nothing since he has precedence

Questions:

1. What can I do in this situation? I just would like the best way to get my $10k back. If I do not do the quit claim deed, it will go to foreclosure. If I do the quit claim deed, I get $1,000. Seems like I can just let it go to foreclosure and hope it gets higher than $72,000 so I get paid something.
2. If it goes to foreclosure and I do not get anything or part of my investment, can I sue the borrower since the second lien was with him?
3. Any other ideas?

I really appreciate any advice! I have the PDF documents that I can share if anyone here is a lawyer and can advise. 

Oops. Meant to tag @Lorne Bridgford, not @Ryan Robbins. Sorry!