All Forum Posts by: Jeremy S.

hello everyone,

My wife and I just purchased our first 2 rental properties for about $20k each from the same distressed seller. They are both currently rented for $750/month to tenants who seem to be taking care of the places and my intention was to hold these properties as long term rentals but, when they asked me about paying rent ahead 3 months with tax return money, it got me thinking. What if I could get them to purchase the properties from me for $50k and use that tax return money as a down payment on an FHA loan? I would offer to pay all closing cost involved. My agent is going to make a cost sheet for me to present to them that would show they could have a mortgage payment of around $350 if they purchased my properties.

My questions are:

1) is there any way I can go about making sure they will be approved for the loans before I bother presenting them with my idea?

2) what kind of inspections will need to be done for an FHA loan as they are not in the greatest condition?

3) how can I make sure they will appraise for $50k and be FHA approved?

4) if they do not choose to purchase them, will they in turn be upset knowing that my carrying cost (as they see it) is only $350 leaving me with huge profits?

PS. These are the only properties we own other than our personal home and we bought the rentals outright with cash so I have no mortgage.

I thank you in advance for any advice.

thanks everyone for your advice. I will pay closer attention next time

what incentive would the attorney have to tell me the minimum bid? Could they lie to get me to bid higher? I don't see y you would just bid what they tell you and not test it out. Normal bidding is in increments. You don't bid 43900 after somebody bids $1. How would you know you couldn't have won the auction with a $500 bid?

wow I was quoted $150-200 for a title search in my city. I understand that beats the alternative but I would probably bid on 1/10 properties that I search. Any suggestions to find a better rate?

But how do you know that unless you bid it up to find out? I'm not trying to go there and make waves

thank you Wayne, is the amount you are referring to called the "judgement" on the county website? I seen some sell for less than that number and some for more.

what is the best way for me to find out the "gotchas" on a given property?

My fiancée and I went to a local sheriff sale today strictly as spectators with an interest in bidding next time. I found several things to be confusing.

1. The attorney who was representing the property always opened the bidding at $1 and won 9/10 times with a $1 bid. What does the attorney do with those properties? Are they for his personal use?

2. When there was a competing bidder it was never $2. It went straight to some odd number like 43,701. Where r those numbers coming from?

3. There were 40 people there but only the same 5 guys would actually bid. We're the rest just spectators like me?

4. Why do people allow so many properties to sell for $1? It seems hard not to profit on a price like that.

5. I intend to bid next time around on a property either to use as a rental or a flip. What precautions should I take? Obviously a title search and any type of inspection of the property I can do but what else?

welcome to BP, I'm in harrisburg. Have you tried a local investors meeting? I believe there is one in your area on the third Thursday of every month. I learned a lot from the meetings and they are great for networking. Good luck

I agree that financing could be an issue and I may have to settle for just one of the properties. The total purchase price would be 440k and we have about 105k between us and we both have credit scores ~800. We have no debt and a yearly salary of 120k. I'm currently renting and she lives with her parents. Any suggestions on how we could get financing for this project and still have 10k to renovate our unit before we move in?

I will update after I speak with a lawyer. Thanks agaib