All Forum Posts by: Paul S.

Hey BP Community,

I haven't been on in a while, but here is my basic issue that needs a solution. Long story short, I quit my job 5 years ago and starting investing full time. Found most of my leads through direct mail campaigns. A couple years in, I teamed up with some other investors and we turned our attention foreclosure auctions which we had great success in. Now, with COVID in play, the courts are shut down, there's the moratorium on foreclosures/evictions, and I've gone back to mailing with little success. I suspect with companies like Offerpad and OpenDoor, many sellers are going that direction (which wasn't a thing 5 years ago) to sell their homes. 

So, where are you finding your leads/properties? What strategies (seller/creative financing, lease options, mobile homes, cash, etc.) are working for you? More focused on flipping, but I would also take more rental properties to add to my current portfolio or really any deal/strategy that make sense. Let me know your thoughts! Thanks Alaina

Hi Bigger Pockets Community,

I'm looking for both commercial lenders and commercial brokers who will lend in North and South Carolina. I'm targeting small multi-family deals from $500k to $1Mil with long term financing in place.  If anyone has any good contacts, I would appreciate you passing them along. 

I appreciate the insight. Let me step back and ask a more basic question to get to the heart of what I'm trying to figure out. 

1. If I bid on a property at auction (SC in this case) and the 1st mortgage lien holder is foreclosing, what other liens would I be responsible to deal with if I win? IRS? HOA? Mechanics Liens? Personal Judgements? Any other lien I have not mentioned?

2. What if a junior lien is foreclosing? Am I responsible for the 1st mortgage?

My understanding thus far is that 2nd mortgages would be wiped out if the 1st mortgage holder is foreclosing. Everything aside from that is confusing. 

Hi Fellow Investors,

We are interested in buying properties from Auction in SC. I'm curious to know if anyone is the investing community is currently buying auction properties and how you deal with unclean title concerns. Do you do a title search through a title company/attorney for all properties you are interested in bidding on? Do you perform your own title search via a register of deeds site? 

Part 2 of this question is from what I understand, junior liens are expunged when the first lien position holder is foreclosing. I believe the exception to this is a property tax lien. Does anyone have experience with other liens (say other than a first mortgage) coming up to collect after you've purchased the property? Ultimately, I just want to understand the pitfalls of auction properties with title and how to either avoid those pitfalls or deal with them if they arise. Any insight would be helpful. 

--Alaina

Personally, I would avoid $10k flips as well. There is not enough margin in case something goes wrong and really, for several months of work, it won't be worth it. A couple of other points:

1) If you are financing the houses, you will be at a disadvantage compared to investors buying in cash. Also, some of the best deals for flips cannot be financed (houses from wholesalers, or houses in very rough condition due to lender restrictions).

2) Make sure you have a accounted for all expenses like purchase closing costs, fix up with buffer, holding costs like utilities, taxes, insurance, costs associated with borrowing money, selling closing costs, etc. If you haven't accounted for all of these things your profit can very quickly become non-existent. 

3) Finding houses on the market these days is becoming more and more difficult. You may try looking into some other streams as well.

For sure we are in!

I keep hearing of homes that cannot be financed through traditional means due to condition deficiencies like broken windows, non-functioning kitchen, no running water, etc. These are examples but is there an actual list of condition issues that make a house not worthy of financing (in Fannie Mae guidelines for example) or is this nebulous territory? I would like to be able to tell a seller with authority of such specific conditions to give me the upper hand in negotiations.

Gentlemen,

Thank you all for your great comments. I really appreciate your feedback on the topic and am looking forward to using your advice in future calls.

--Paul

Hey @Phil B. , thanks for your perspective! On a totally unrelated note, I'm from Tampa too (Valrico technically). Hope you are doing well down there.

We offered to take her off the list but she refused to tell us her address so we can't do so. Now we will just run the risk of offending her repeatedly on follow up mailings which is not an ideal result for anyone.