All Forum Posts by: Howard C

Hi All,

I have done relatively well for myself and have build a portfolio of over $10M, mostly in the Brooklyn, Queens, and the Jersey City, NJ markets.  The issue that I'm having now is scaling the business from a $10M to say $100M.  How does one do it?  

Without partnering or doing JV how does one grow their business. My capital is always tied up and whenever I have any cash I just dump it into properties. Anybody going through this growing pain as well? If so, how have you handle it and how are you able to scale up?

The only thing I can think of is to obtain a line of credit with banks that will be able to cross collateralized the properties and offer a line of credit, does anybody know of a bank that would do it in the NYC/NJ areas?

Yes, I'm holding a 2nd subject to the first.  I wouldn't want to sell a note for a discount unless I get enough to cover the first, which I doubt I will get. I guess the best bet for me right now is keep on paying the 1st to keep my credit in tack and then foreclosure when the price goes back up.

I know I won't get much as a 2nd NPN as I have already tried? Any accountants here? Would I be able to write off the entire mortgage as a loss?

I am currently holding a 2nd mortgage on a property that I sold to a homebuyer.  He is now in default for over a year (I am still making payments on time on the 1st). I don't wish to start a foreclosure process or a deed-in-lieu of foreclosure as the property might not be worth my time and money spent to do this.  The property has dropped in value since I sold it 3 years ago and with the fees associated with hiring an attorney and initiating the foreclosure process I don't think it is worth it for me at all.  So what would you do in my situation?  Also, is it possible to write off the entire mortgage as a loss this year on my tax return? 

Advice needed.  Thank you.

The property is 850K, so 50K down is actually only about 6% of the deal, which isn't too bad. I am more concerned about how I can be protected in this deal. What, if anything, can be done to prevent the owner from going around my back and sell my rights to somebody else?

Hi all,

I'm new to the forum so I appreciate the kind welcome. I am currently in talks with an owner regarding a structured seller finance deal where the owner will agree to give me the rights to repair and resell his property and essentially serve as the property manager from a maintenance perspective, whereby I will be receive all the rents and also be responsible for the private mortgage that he will provide me. There is no bank mortgage as he had previously paid it off. The deed will not transfer so technically I don't own the building but have equitable rights to it, similar to an installment land contract. He also wants 50K as a down payment or security deposit in order to agree to the seller financed deal. I am OK with this because I know I can flip this property, after the repair is done, and net 200K.

I have several concerns though. If I don't own the building then what happens if the owner changes his mind and decides to sell it to somebody else. How will our agreement hold up even though it will be recorded? Can he still sell the deed to somebody else?

From a tax perspective If I end up spending 50K on the building, would I still be able to write off the capital repairs and take the depreciation of the building even if I'm not the official owner?

Is there anything else that I am missing or should be concerned about? Please help me make the decision to see if this is a deal worth moving forward on. Any advice would be greatly appreciated.

The question becomes, even if the lender calls the note due, how much time do I have to refinance or sell the property as an exit point? Or is it usually up to negotiation when that does happen? The seller says the only way he will transfer the deed is through a quit-claim, which I am OK with if the title search comes back clean(of course except for the existing mortgage) and if the title company is willing to insure it.

I have come to an agreement with the seller who is looking to sell his deed to me, subject to the current mortgage he has with the lender. He is doing a quit-claim to me for a 25K fee. My concern has to with the "due on sale" clause that exists in his mortgage, and most, in general. Has anybody heard or actually experienced the lender calling the note due and actually exercising this clause. If so, how much time did the bank give you to pay the note off before commencing foreclosure?