All Forum Posts by: Rick Turman

So what was the turn out of this?  How much coverage did you have, and what coverage should you have?  Do you have an umbrella policy separate than your current?  What would you recommend or prefer?  Is there a rule of thumb for coverage?  I'm asking now before I make the same mistake that others may have underwent.  Thanks guys!

So.....

I've been talking to other investors as to "What they do" in this situation. I'm in acquisition period of a property and have the Deposit and receipt of purchase on a Sheriff Sale home. I am told at least 30 days for the deed to be mailed. I have two weeks remaining and would love to get started and have this bad boy back on the MLS by End of August.

My question to you is, when purchasing from Sheriff Auction, do you start Demo and drop a dumpster the day of deposit, or do you wait until you receive the deed and close?  

I'm not adding to it, would just like to demo until I have full possession.  Property has been vacant since early April.  

Responses in 3.....2.......1... and GO!

@Charles Parrish,

Thanks for the reply. The sale price went to the taxes owed as we usually have Banked owned and Tax sales on properties here. I will be reaching out to my Title agency that I use for REO purchases to obtain Owners Title Insurance as they office insurance not having to wait for the property to season. What blew my mind is the Sheriff mentioned that most investors start right after the deposit is paid. They also mentioned the Law does NOT frown upon it, however legally I have no rights of the property. Pretty much she was telling me I shouldn't add anything before I own it so I don't get robbed and can't prove anything which i understand. I only intend to Demo and wait until i own the deed however will wait if necessary.

@Nathan Gesner,

You are absolutely right. The NOD was served quite some time ago and the property has been vacant since April. WiIll not have to worry about tenants or evictions. The Sheriff mentioned the deposit goes right to the Attorney that the property was being sold by, and commissions also go to the tax liens to pay for and fees incurred.

She laid out the waiting period to obtain the deed and stated it could take from 30-45 days before it would be in my name so i'm not sure the above redemption period is applicable in this situation. On a side note, I always understood the redemption period being after the Sheriff sale (before it is confirmed in the court) or it was 30 days prior to the Sheriff sale (After the NOD).

I will dig a little deeper into the Ohio laws as I would like to at least start pumping out the 2 FT of water in the basement due to the flood this city just underwent.  No power = no sump pump = no bueno :-)

I do have one last question.  After I am notified of the deed, do I still need to attend closing as we would on a normal sale for a property, and if so, are they less fees or were they paid for during the sale/court case against the home to turn over the deed?  E.g. County recording fees, Lawyer fees for deed prep, Washing hands fees, fees for Washing your hands before prepping your hands you get it.  Thanks so much for the reply gents.  It's a learning curve, and would love to get my facts down from what you've all learned.  

You are the winner!

So I got into a bidding war on a property and acquired my first Sheriff sale.  I paid the Deposit and am waiting for the Attorney to complete her end so that the deed is prepared in my name.  My question to you is what happens next?  At what point are you aloud to start work on the property?  Has anyone had success getting insurance on a vacant property prior to Deed ownership?  Thanks all!

@Lenita Higgs,

Most of us try to pay in full at first, so when we do the BRRRR we can get all the equity out that we put in and then some if the numbers work out. This sheet is mainly for calculating COC-ROI if you were to Re-finance afterward with a bank. Simply put in your mortgage amount in and see what your numbers would be. If you are not going to refinance, I guess you could leave this spot blank to see what your actual COC-ROI would be. If the number is astronomically large, it could be due to you not having that mortgage hence less expenses against your return. Good luck!

@Lindsey Mahoney,

Always would love to connect with another investor and brainstorm.  As for the Columbus and surrounding areas, @Robert Ellis may know the ropes a lot more than I do.  There are also quite a bit of people on here and in the BP Marketplace form the Toledo area.  I saw a thread on the new hot areas a few weeks back and I cannot find it for you.  Thanks Lindsey, and keep up the excellent work.  Your portfolio really has a lot to say.

@Garlin Smith,

Thanks for the shout out!  OH-!  Anyhow, CA is a far way away's so it seems.  There are a ton of Ohio-Southerners on BP that can help answer the  question you asked back near your home town.  I see a lot of people requesting advice in the Cleveland area.  There is actually an individual who specializes in just that in Cleveland and I cannot think of the contact for the life of me.  I'm sure if he has his keywords set, Cleveland will trigger a notification and he can chime in.  For that individual, I am sorry I can't remember who you are :-).  

I grew up right outside of Cleveland and can let you know about the areas around there that are expanding rapidly fast that may be a great opportunity to get into. Look for areas of market drive, meaning, big business involvement, need of demand for housing e.g. American Greetings just moved from a Cleveland Suburb to Westlake, OH. Two hotels are going up and not that many affordable apartments in that area anymore. If you have the equity, build and or BRRRR your way into the riches. There is more company involvement going up and the Avon and North Ridgeville areas out that way too. Not as big of cities like Columbus, but a way to get started at a great cost, and bring Magnitude and Quantity into your favor.

As for other areas, Toledo is a hot area, Cincinnati is getting a lot of attention again. Other areas outside of Columbus are starting to blow up like Delaware with their new Outlet malls and city expansion they are doing. Dublin and also Westerville has expanded. Then again you always have the OSU Campus to look at getting into. Check out the Marketplace on here as there are quite a few people selling their PM'd properties at great COC-ROI.

I hope this helps gets you energized.  Just stick with it and keep on keeping on!  

-Rick

I'm going to turn to my BP family for this one....  This question has been bothering me and i'm in need to ask it before i get stuck in this analysis paralysis mode again on Rentals.  

We are looking to put our first offer in on a Multifamily and have already done most of the foot work to see if we can get our Refi.  My question to you all is we don't own a home as of yet and are looking to purchase for our own maybe 2 years down the road.  Does BRRRRing put a damper on lenders providing multiple mortgages?  

Let me scale this down. I want to have at least 4 BRRRR's completed within these two years. That means 4 conventional mortgages out at once. Once this two years are up, we are looking to settle in a house of our own, you know doing the whole 20% or more down and live in it. Will we have a problem getting financing on a 5th house?

How does the debt to income ratio work? Say the first 4 homes are cash-flowing 200+ per unit with a 12-20% COC-ROI, do the banks see this as a red flag that so many mortgages are outstanding or due to the loans being paid down, and the properties are bringing in Cash, and I have a full time job, it shouldn't be an issue? Sorry for the 21 questions. Need to push past this barrier and jump!

All the best,

-Rick

@Abbas Raza, I also agree with @Austin Fruechting. Other investors on BP have also had this same issue with banks only offering 70-75% of initial sale price of the home. Other's found that searching for local or mom and pop banks will lend up to 80% ARV at 6 mo and 12 months after it's seasoned. Do some more research and call a few more smaller banks. You may just find that 1 that will allow you to do more than you were initially looking for :-). I'm also investing in Ohio (Hometown) and am looking to get into some multifamily. Would love to connect. Cheers to your success!

@Pearce G.,

Thank you kindly for explaining this. It didn't quite hit me until you mentioned when I refinanced, I would have a lower skin in the game which would drive the COC-ROI percent up as well. It makes sense now. Thanks again, and I will definitely be making a deal on this house. Cheers!