All Forum Posts by: Ray Trounday

I am working to start my fix/flip and buy hold business. I am looking for guidance on create an entity to support it. I am minimally looking to create a LLC for each flip and move the flip to an S Corp should I decide to the hold the property long term. Thoughts? or any guidance or online material that people would recommend. I want to research the topic thoroughly before sitting in front of an attorney and rack up fees.

Hi,

I am looking for skip trace service recommendations that will support my effort to locate the contact information for a farm of out of state owners.  Do folks know of a service where I may feed a spreadsheet of Owner name, Mailing address through CSV or other form and have it return the email and phone numbers?  I also welcome any other thoughts on how I can expedite the farming of this contact info.  Thanks in advance,  Ray

Thanks @Andy Mirza I am not as familiar with arriving at IRR.. Any links or sites that you could direct me to? I will research in the meantime too. Thanks in advance!

I have been working my HP 10bii to arrive at the Effective Rate/Yield on purchase of a note with a balloon.  Lets set aside for the moment the likely-hood of having the borrower actually pay the balloon.  In most cases, borrowers will need to refinance prior to having the balloon due.  I digress back to my example:

Loan Type: 5 year loan with balloon (Payment amortized over 30 years

Original Loan Balance: 100000

Rate: 9.99

Payment: -876.83

Amortization Term: 360

 I will need to first calculate the balance that is due on the 60th payment.  So, I do the following:

N: 60

I/YR: 9.99

PV: 100,000

Payment: -876.83

Calculate FV

Balance due: -96,957.91

Lets say that I buy the full note for 70k. So, I modify my PV from 100k to 70k leaving everything else the same from above

PV: 70,000

N: 60

Payment: -876.83

I arrive at Effective Rate/Yield: 19.56

Thoughts on the correctness on the above?

@@Mitch VanDeveer 

The R3 lot is 1/3 of an acre. I have been approached by a number of landscapers to store their trailers etc but I have been hesitant for the potential of fines but I am also looking to turn some income while it sits there too

I am looking for land lease rates in Phoenix. I am a R3 multifamily lot in North Phoenix. I am looking to lease the land as storage for large equipment or other residential storage (campers, RVs) but don't know how to find market rent land lease rates.  Does anyone see any issue with using an R3 zoned lot in more of a commercial way.

@Peter Grote

Generally, notes are priced as a percentage of unpaid balance.  For Performing, you are looking at 80-85% of unpaid balance but I have seen as high as 90%.  Factors that contribute to pricing is seasoning(payment history) How consistently has the borrower made his payments?  Also, some measure of the likely-hood for the borrower to continue to pay, credit score, work history etc.  

@Dustin Mathenia

I like it!  You provide the borrower an opportunity to get into a home at or below market rent for the area and he can build in sweat equity to the property and potentially he can refinance you out of the deal.  It is not clear whether a bank borrows on a property that is worth 25k.  

@Dustin Mathenia

To summarize:

Loan: 17k

Payment 350

Term: ?  (I am assuming it is for 5 years)

So, you paid 4k and paid $115 to date in taxes.  So you are all in at $4115 barring any other expenses you had over the last 5 years (fire insurance, utilities etc).  You collect 2k which reduces your cash in the deal to $2115.  So, if you do sell the note for 5k, you would have made 3k.  Or, as you said have someone get in there and fix the house so you build up the market value should he decide to default, you indeed be rolling.  I like it.  Thanks for sharing!!!