All Forum Posts by: Phillip Trujillo

@Bob E. An RMLO will be needed then because I plan to market to owner occupants, not investors.

@Wayne Brooks I agree with your first statement and won't come into any of his properties for much more than a wholesale number. 10-12% seems to be the going rate for owner financing in my market. 10% for properties $50k+ and 12% for properties sub $50k. Again, these are just the numbers I've seen in my market. Care to elaborate on why you asked that question in the first place? I'm always looking to gain some knowledge. Thanks!

@Account Closed The repair estimate was too low. After some after action aka "What the hell went wrong?!?!" investigating, some contractors told me I was about $5000-$7500 off on the repair cost. Lesson learned.

Just to update everyone else: Both of these contracts were cancelled. As stated above, it's a learning experience and I was simply grateful to have the opportunity to get involved. Unfortunately neither deal came to fruition, but what I did learn has led me to make corrections and press on.

@Jarod Rotolo The first two properties I got under contract, I ended up having to back out of. My area doesn't seem to be able to support the sale of properties that require large rehabs. I heard, "this is too big of a job for me." from multiple potential buyers. What I did learn is that there's a HUGE market for owner financing deals so I am currently putting more focus on those.

I received a call from a local landlord looking to off load some properties. He's willing to owner finance them and I see potential for spread, both on note payments and down payments.

Scenario:

Property #1 Purchase Price of $25,000 w/ $5k down and note at 5% on 5 years.

Sale of Property #1 would look like this: $30,000 w/ $7500 down and note at 12% on 5 years.

There's potential for $2500 at closing and about $130/mo in cash flow from each note. There's 8 of these properties available. Note: All properties are free & clear.

Questions: Am I on the right track with these properties? Will I need to enlist an RMLO for the notes or can my standard closing attorney structure these? The above can be performed as a double-close right? Any and all guidance is appreciated! Thanks.

Phil

@Gautam Venkatesan The numbers on both properties are here: https://www.biggerpockets.com/forums/93/topics/117586-i-purchased-my-first-lead-list?page=2

@Tim G. Agreed.

I've contacted both sellers and have informed them of the feedback I've received. Neither was willing to negotiate down and I also tried to negotiate seller financing options, which both denied.

They've been informed that the contracts will shortly be cancelled. I'm going to re-list both of them (with prices I'll net next to nothing) and if they're not sold in 7 days, they'll be cancelled.

@Shawn Thom A lot of the new rehabbers that I took through the bigger of the two properties had only done cosmetic flips. This property needs a roof and a gut in the common areas (bedrooms are cosmetic repairs) so they couldn't accurately gauge holding time, exact costs, etc. The second of the two houses is a 2/1 800sq/ft and needs <$8k (all cosmetic) repair. Nobody that's been interested has been an actual section 8/slum-lord though. Tire kickers.

Here's the houses: https://www.biggerpockets.com/forums/517/topics/124034-wholesale-deals-3-2-and-2-1-in-warner-robins-ga

After my mailing I had a plethora of leads and turned those leads into 2 contracts with sellers.

I'm 23 days into both of those contracts (3 days past my inspection period) and neither property has sold. I've had 20+ buyers in both properties and they're either not what the buyer is looking for or "too big of a project" to take on.

I can post figures if anyone would like to see them here, but I've already tried to re-negotiate with each buyer and they're both firm on what we agreed upon. Unless these sell in the next 7 days, I'm looking at two cancelled contracts and two failures right out of the gate. Not how I wanted to start things off!

From my mailing, I'm constantly being contacted by owners of free & clear property that won't come low enough on pricing for me to wholesale, but are more than happy to do super reasonable owner financing deals.

From advertising my wholesaling deals, I'm constantly being contacted by buyers with down payments that want owner financing (owner occupant).

How do I (legally) structure these deals to make it a Win/Win/Win?

Note: This is in Georgia where the owner financing laws have recently changed. Any info would be MUCH appreciated. Thanks!

Phil