All Forum Posts by: Nathan Waters

@Josh C. Thanks for the information. I appreciate it.

@Nathaniel Aaron Chaney So where do you put an initial investment? Say I pay cash for a house or put down 30k? I'm assuming that also goes into assets on the balance sheet? I paid for quickbooks property manager over a year ago and never took the time to go through everything and input it. Its something I need to spend about a week working on. 

When you write up your profit and loss statement, how do you break down the mortgage? Is the interest, taxes and interest the only loss? I'm assuming principal is not written in the loss category even though it goes against your cashflow. I'm trying to create a profit and loss statement for a seller financing deal. I currently have 5 mortgages but have not been great at keeping track of the details such as costs associated with each individual property. I tend to lump everything together. Any advice? Thanks in advance.

Good luck. Hope it works out. I'm selling my out of state house right now. I'm hoping to be done with it by the end of the month. (Its under contract now). I want to focus on an area closer to where I live. It makes managing contractors and tenants so much easier.

@Jameson Sullivan

One option is to approach private money lenders. You may end up paying more for it though.

@Scot Sorenson

Having gone through the out of state landlord thing on my personal home, I feel your pain. If they are paying on time and the worst damage is the yard and boyfriend, I would personally let it go. It may be more costly to find a new tenant and turn the property if they move out. I would address the pet issue. But I don't know how you would do that without proof that doesn't involve pics of their window. It might come off as "Big Brotherish" and freak them out. Then again, maybe that's the motivation needed to keep them from ruining your property.

@Steve Vaughan

Thanks for the explanation. I know my deal carries some risk. I plan on refinancing in 6-12 months to complete the deal. But I want to learn ways to do this better going forward. One aspect of that is getting a better attorney. He recommended the contract for deed route. I need to find someone more well versed in subject to and using private lenders. He seemed overwhelmed with what I was trying to do. He's getting it done now, but it was like pulling teeth to put it together.

I am closing on my first seller financed deal in about a week. It is a contract for deed. There is a current lien on the house that I will be paying to ensure its not missed. But my question is this:

Whats the difference between Subject to, contract for deed, or wrap around mortgage? If someone can explain any details that differentiate, I would appreciate it. Subject to and contract for deed seem very similiar. From my understanding, a wrap around is a new mortgage from a lender that includes the initial mortgage? I may be off on that one.

@Phillip Lee

@Mario Calabretta

Regarding the terms, Its up to you and the lender. I just did a deal with 3 different lenders. I sat down with each one and asked what they were comfortable with. They all put in the same amount but one wanted to get his principal back within 12 months. The other two are looking for long term diversification so we went with 24 months with the option to extend if both parties agree to it. My goal was to make my investors happy and accomodate their goals. By doing that, you will get what you want out of it as well. Just keep in mind, you will have to wait 6-12 months to cash out refinance based on the new ARV. Different lenders vary, but thats pretty typical. Otherwise your cash out will be based on the initial purchase price.

I made an *** ton of mistakes on my first deal. And every deal really. But its working out. I'm not one of the rock stars that's crushing it. But I am cash flowing on 4 single family hosues now. Don't let people crap in your cheerios. Learn from their mistakes, learn from your mistakes, and then get started. I don't think it matters if your first deal is a SFH or multi, as long as the numbers work and its a good deal.

Welcome to the group. I would start hanging out with other people near you that are in some way working in real estate. Meet others from BP that are in your area and pick each others brains. Good luck.