All Forum Posts by: Robert Dobbs

Lenders have more to worry about in Las Vegas than "due-on-sale clause violations".

As long as this loan remains "current & performing";

...you have a better chance of "hitting the jackpot" at Caesars Palace, than having the lender accelerate an otherwise performing loan in good standing for a violation in the "due-on-sale clause".

Spending a few hundred dollars with a good attorney that specializes in these types of land contracts should be worth the money. (...try finding these types of lawyers who are affiliated with your local Las Vegas Real Estate Investment Club).

A lawyer of this type can create a new, or review and update your trust/sales-agreement, land contract, etc.

Here's a different twist:

How about a back-up agreement and a back-up deed?

Well, let's say an agreement is reached to transfer the home via some sort of owner financing.

How about a second signed agreement that states:

"Just in case, because of regulatory or other reasons, a "more traditional type of sale" is required to transfer said property. Both Seller and Buyer agree to create and sign a traditional purchase contract and a traditional deed, such as a "Warranty Deed", as a "back-up", just in case a more traditional sale is needed".

See if an attorney will help you "draft the language needed" and assist you in executing these "back-up" documents, and maybe "store them away for you both", just in case they are needed in the future?

So if there is any doubt about transferring title or "chain of title" issues because of "owner financing in the future, maybe these "back-up" DOCS will be "just what the doctor ordered"?

This paperwork (signed deed and agreement for sale, etc.) will not be for "public consumption", unless made public out of necessity.

Plus, you have a creative way of making this owner financing deal become "more of a regular deal" if needed in the future!

I'd like to hear from some attorneys out there, if there are problems about creating a "back-up agreement" that have the "ok of both Seller & Buyer"?

rd

Walk into a local title company (or one that is recommended to you!).

Tell them you are just getting started in your real estate investing career and will need a good title company to work with.

Ask them to show you how to look-up online mortgages at your local "County Clerk of the Court" Website.

I'm sure they will be happy to show you!

rd

Here's something to ponder:

Imagine that you did 25 deals this year, all pretty-much the same:

1. Found a motivated seller with a cool property.

2. You put the property "under contract" (via an option or a signed contract).

3. You "flipped the deal" ("assigned the option" or "assigned the contract") to another person.

4. In other words, you allowed your seller to contract with your buyer and you are paid at closing (an "assignment fee", an "option release fee" or some other "creative term").

5. The deal closes and you're "fee", "payment", etc. is listed on the HUD1 Statement.

6. Now, you close your 26th deal, and suddenly, you get a letter from "the commission", that through an audit of the title company you used, we noticed a pattern that you received a "fee" on each of 25 HUD Closing Statements and;

7. "The Commission" wants to know what these "25 fees" on "25 different HUD Statements" were for?

8. Well what have I done?

9. Did I "back out of 25 contracts" and did I "collect 25 fees" from "25 sellers" for "finding 25 buyers" to replace my position "25 times"?

10. Did I assign my options or my sales contracts "25 times" and received "25 separate payments" as listed on "25 different HUD Statements"?

11. Is the "Real Estate Commission" wondering how I keep making a "fee 25 times" during the same year on "25 different HUD Closings", without being a licensed real estate agent "25 different times"?

12. Well, has a "pattern developed" (yes, now "25 times"! LOL!) that ! need to be worried about? (Well worried about now "26 times this year"?)..

13. As you can see this imaginary scenario of 25 (now 26,) "flips", "options", "assignments" or "whatever they are called" all produced the same results:

14. You NEVER closed on a deal in your name, you just received "25 fees", "25 profits", "25 contract release fees", "25 option fees" or whatever you called them.

15. Are these 25 different HUD Closing Statements like "fingerprints" and have I created a "pattern 25 times" for a "Real Estate Commission" to forensically look at my 25 deals to see if I indeed created a pattern that "The Commission" may say can lead to 25 different felonies? (YIKES!)

16. Nah! I have nothing to worry about! I'm a successful investor! I've done 25 deals this year (now 26 deals! LOL!), so again, what do I have to worry about? I'm not practicing real estate without a license in my State, I'm perfectly legal! Right?

17. Don't worry I'm just having some fun here (AND MAYBE MAKING YOU JUST A LITTLE PARANOID? LOL!!!)

~~~~~~~

18. I do hope every one of you reading this will do 25 or more deals in a year!

19. Are you comfortable with the 25 or more HUD Statements on your deals?

20. I hope so! If not, question how one can improve on them, without changing "the fiber of the deal"? In other words, without "reinventing the wheel".

21. Just always remember, if you are not a licensed Realtor and are sucessful doing multiple deals, try to "look back at the finished products" and see what I can do better?

Good luck to you all!

rd

Each loss mitigation department for the banks works differently than another

Some banks have "layers of workers"

Processors, that may look and initially approve a POF letter, while others will "send it upstairs" to an "assigned loss mitigator" for approval.

Think about it? Some bank processors and mitigators, understand what a proof of funds letter usually means.

In other words, they may already understand that most who submit a POF, are not putting any "skin in the game", or in other words, are using someone else's money to fund the deal.

While others may not have a clue just what a proof of funds letter represents.

While others may accept proof of fund letters, because they have successfully closed deals (double closings) without any issues.

So, after my "long-winded" explanation there are so many different individuals working for these "decision-making" loss mitigation departments for the banks, servicing companies and mortgage companies, that their decision to accept or reject a proof of funds letter will be as varied by so many different factors.

You can try to set-up a good, professionally written cover letter to accompany your proof of funds letter, via a pdf file so, when your proof of funds letter is received, it will also show your cover letter, illustrating just how fast you are ready to close, and how your professional team will work very hard with the "loss mitigation team at ABC Bank" to get this deal closed! etc. etc. etc.

As far as the (iflip) POF letter that was reported rejected? Like I stated, it could have been for a number of reasons.

I'd like to read some posts here on bigger pockets from individuals that have had some recent successes using proof of funds (third party money) letters and the use of "double closings" regarding short sales and/or REO deals.

If you have done some of these deals, can you kindly post your successes or failures?

TIA Bob

A good agent can:

1. Make an offer for you.

2. Help you close the deal.

3. List the property for you.

4. Get it sold for you.

5. And it is possible you never even saw the property!

Sounds impossible? It happens all the time!

Keep looking for a good one!

rd
Capital Homes Real Estate Inc. (Realtor Associate)
Land Rescue League LLC, Managing-Director (Property Liquidators)
As Trustee for: The Renaissance Trust DAT 8/25/01

"Strategy for next 5 years: Sell Real-Estate and Buy Gold"?

That sounded like a perfect strategy for the 5-year reriod:

August 10, 2006 to August 10, 2011

rd

Please "google" the

Dodd Frank Act
(and how it relates to S.A.F.E.)

It is the "buzzword" topic for many of the "seller financing gurus" and currently a troubling topic on various note buyer blogs, teleseminars, and webinars.

I have received multiple emails alerting me as to our Government proposing changes to an amendment (i.e. Dodd Frank Act) that will make things more difficult for seller financing deals by including language in the amendment that may restrict the use of "seller notes and mortgages".

Realtors, investors, homeowners that desire to sell a home via seller created mortgages should read what's going on with this Dodd Frank Act.

It seems very concerning. A must read, IMO.

rd

P.S. "Our Government keeps getting bigger!" Yikes!

Hello Dennis!

You are very lucky you only received a warning from the State of Florida, phew!!!!

Not only could you have been accused of practicing real estate without a license, you could have also been charged with practicing law without a license.

Why?

Well, if you gave a homeowner advise as to how to sell their home via a proposed option to purchase agreement, vehicle, contract, etc. that, as you stated, "you would create the option after you found a buyer".

You cannot offer your services to create an option agreement, or for that matter any other form of contract, or even giving someone advise as what real estate contracts to consider, even if you were licensed as a Florida real estate agent.

That's practicing law!

A licensed Florida real estate agent must use only Florida approved Leases and Sales Contracts.

Being a so called "principle of the deal", via an assignment, option agreement and also being a licensed real estate agent that may, in addition to a "flip fee", a wholesale amount, an option release fee, some assignment fee, etc.;

if you intend to make a real estate commission too, just be careful.

My advise? Have an attorney, "review" all the contracts, agreements, assignment forms, options, etc. And if your attorney agrees that those forms, contracts, etc. are OK to use, have the lawyer write them for you. A good tip! Find a title agency in your area that is owned by an attorney, or has an "in-house attorney" working there. Or just find a real estate attorney that does closings. Agree to give him your title work for "the deal" and most will only charge you a nominal fee to "oversee" (re-write your paperwork).

So, take the advise that was given earlier.

Have "equitable interest" in a said property.

Wait a minute, have "marketable equitable interest" in a said property.

Well, you say "what's the difference"?

Not much, but an option, agreement, contract, etc. that states in writing, that you (the buyer, optionee, etc.) has the right to transfer, sell, assign his rights. And the seller will allow the buyer to show the said property to the buyer's (or optionee's) interested parties. (I would add that the seller understand that the buyer (or optionee), will have the right to hire a real estate agent and list the property on the MLS, etc.).

In addition to all of the above, I would have the seller sign a "Memorandum of Understanding" (which is a simple agreement that displays that equitable interest has been established between the seller and buyer (seller & optionee).

Good examples of various "memorandums" can be found on the Internet.

As a buyer (or optionee), I would then record the "memorandum", with the correct county or city.

That simple document will go a long way, combined with your other docs (contract, option, assignment agreements, etc.) to demonstrate to the State of Florida, that you indeed have a "right of marketability" (long with your "equitable interest").

Dennis, I would think very long and hard to what I (and others) have posted here.

And if these things are not quite clear to you, then you will need to learn them.

Know what "a principle" of a deal is plus having "equitable interest" means in your State, and what rights you have (or don't have).

Again I cannot stress this enough, if you are unclear about what to do, get professional help.

Just "some added steps" to what you have done, can protect your interest in a deal, and should protect you (with the State of Florida).

Please note I'm just a fellow investor giving you "my 2 cents" on this thread, and suggest that you obtain legal advise from a Florida Real Estate Attorney, Title companies and professional marketing opinions from licensed agents...

Good luck with your deals Dennis!

rd

BTW, "Happy 4th of July" to all!

Has anyone purchased AMPS or MAPS?

If yes, are you working the program and is it making you money?

And what do you like or dislike about these programs?

TIA

rd

figure to spend $3600 to $4000 a year for a well-funded long term care policy.

May come with nonforfeiture benefits, which mean if you fund it for ten years, and then payment does stop, there will still be some limited continued coverage after ten years.

If you cannot do a deal with them, suggest that the mother do a reverse-mortgage on the home. She can pull out about $416,000 on a DC home, valued at 700K.

She can definitely get some long term care with all that cash! LOL!

p.s. Reverse mortgages are no longer "loans of last resort"