All Forum Posts by: Orlando Goodon

Trying to get into the mindset of a seller. You bought a house real cheap. Invested $200k into it and did top quality work. Then you try to sell it around $900k in an OK area, near some not so good areas. House is top quality and you know will command top rents. Sits on the market for 80 days with one deal failing to close.

Then interest rates start climbing up fast and stock market goes crazy. Buyers are getting nervous and some are already starting to get priced out of market. Market is well inflated too. So things are not looking good.

Then a buyer comes alone. High income, prequalified, but light on cash. They only have $55k, but will need $95k (including $20k reserve).

How would you feel about them asking for seller concession and how would that work? If you can make $40k disappear for the buyer, your house is sold and you possibly end up selling at the peak before the market possibly goes south.

And how would those numbers look like? $900k offer with $40k concession. What would be the loan? $940k? How does that work? Bank cuts check for $940? What money changes hands?

What about seller concession? House has been on market for 70 days. I could maybe try to have seller pay the closing costs. That would be bigger mortgage and eat into my profits, but I should have profits to spare.

Found an amazing house! Beautiful, close to major city, triplex with 4 BR. $7k mortgage, $10k rents, fully renovated, 1700 sqft units. However, just before I want to make offer, bank shoots my $60k-$70k expectations of closing costs to almost $100k. I'm short $30k and have no way to raise that in 4 months.

I'm really frustrated how this can happen. I've been speaking to multiple lenders. I've told them I have $40k available now. I can save at MOST $6k/month(zero debt). I have a vehicle worth $10k and maybe can get a gift of $10k for down payment. That is it. So why on earth would my bank tell me they can get me approved for well over a million? We were looking at even $1.5M houses. Yes, with my income and credit, they could approve me, technically, but it was clear that unless I won the lottery, I had no way of closing on even a million dollar house. Not with 3.5% down FHA. The only way would be a VA lone.

How does a bank talk to a person with less than $50k available about a $1.5M mortgage? This house was under a million, but not one time did any lender say ANYTHING about my lack of funds. They all made it seem like I could as they said 'well over a million'.

Anyway, I'm going to try to get a VA loan, but I might not qualify due to my medical discharge. Between basic and tech schools was about 3.5 months. That is about 106 days. So enough for 90 day requirement, but some requirements say 180 days. That would mean I would have to be in for 3 months after tech school. Not sure I met that. If I don't qualify for VA loan, I lose the house. With warmer weather, it might be gone already as more buyers coming out I'm sure.

I'm going to start looking at cheaper houses tomorrow, while I try my last ditch efforts.

Assuming a really nice and large 4BR on a nicer part of Mount Vernon. How long would it take to find a tenant, assuming you just bought a house and need to find one quickly but not so fast that you pick a bad one? What is best way to find this kind of information out? I'm going to call local realtors but wondering if you have any other suggestions.

Saw a quadplex and thought it was a SWEET deal. Did the numbers using estimates and it worked. Then I found out about the $25k taxes. Then I found out the $14k expenses. That is $3k on top of the $6k($9k total) mortgage. Rents are at $7k. With me in there that is $5k gross income. That is 4k NET negative income. Who would buy this? Been on market for 8 months.

By my math, the deal is for a person with $600k in cash. Put that much down and your mortgage gets slashed and you can break even. $600k CASH in order for a deal? So I believe the quadplex would need to be priced around $800k for it to make sense for a normal person without over a quarter million is cash sitting around.

Those expenses and taxes crushed this deal. Wow. This just made me think. What if I get a house around $800k, then value goes up to over a million but rents don't match that and taxes go up. I'll be screwed. To me it's a good deal since I got it for $800k, but anybody buying it, is buying it at >$1M, so without a ton of money down, they won't be able to afford the expenses. I could be stuck with a hot potato.

Thanks so much for the tips. For now, my new target is the cheapest houses with highest potential rent. Apparently FHA has fixer upper program. If I can find something that needs help cosmetically but is solid structurally, I can get a really low price, then start enhancing. Meanwhile I can attack the mortgage aggressively.

You guys are great! This is why this forum ROCKS! Learn so much here. I think maybe it was damaged at some point, then possible got caught up in the market crash. So multiple factors. I wonder if the last investor who tried to fix it up, got all their money back. Assuming we are correct. I'm guessing they did or at least we are beyond that. Meaning the current owner bought a normal house, possible for a nice post rehab premium + COVID surge.

I have see some CRAZY price histories in Zillow. I know you can't trust Zillow, but I suspect this is some sort of red flag? How can a house drop from $178k in 2011 to $69k in 2016, then in 2020 jump to $500? Is this totally bogus, or a red flag? Best I can think of is a short sale. I wonder if it was a single family converted to multiple? It was built in $1900. Maybe it was in pretty bad shape or something and was restored. I'm ignoring the Covid bump btw...lol