All Forum Posts by: Sergey Tkachev

@Colin G Murphy - thanks for the quick reply

@Bill Gulley - thanks so much for the detailed response.  Yes, I haven't dealt with this specific situation, that's why I'm asking so many q's :).  

Just to clarify a couple things, I don't think I mentioned that the property is in California.  My friend plans to live in this house as his personal residence and the current owner is someone that he knows.  So he is not planning to resell it, owner finance it, etc.  The current owner just doesn't want the house and is willing to have him to take over the payments.  So there is less of that issue of liability and potential problems as would be if this was the usual scenario with a takeover of payments and owner financing it to another buyer - that is not the case here.  

The main question is how to best transfer the title, and Bill, you gave a pretty in-depth answer, thank you, I really appreciate it! The only downside to purchasing it as a straight sale and get purchase financing would be that it would probably require cash from the purchaser - it would either be sold for above the current outstanding loan amount (and require a downpayment) so that the new loan would be a certain % of the purchase price, or as you mentioned, pay down the existing loan with cash during purchase so that the new loan is less and conforms to the LTV requirements of the lender. And I'm assuming the same is true if payments are taken over and just a refinance is done after the fact, since the lender will be viewing the $160 as the purchase price?

I agree regarding talking to an attorney, that was in my plans, I just wanted to throw this out there on the forums and get a sense of direction from others who have experience in this so I know where to best direct him.  Thanks again!  If anyone has something to ad, that would be great! 

So I hope I get this in the right forum - I have a friend who is looking to take over payments from a seller on a SFR and take title (seller just wants to effectively give the house away as long as the new owner takes over the payments). The outstanding loan amount is $160k and the property is worth more than that (this info is not really pertinent to the question).

The question is: what is the best/safest way to do the transfer without spending more money than necessary?  Is a quit claim deed the way to go?  Would this be done via a title company, escrow company?  Is there a ballpark fee that is reasonable for this service?  Would it make sense to purchase title insurance?  Are any specific disclosures needed in the contract from a liability stand point since he is taking over payments?

Those are the questions I can think of.  His plan is to refinance the property within a couple months (the equity is there and the current rate on the loan is 7% so a refinance would make sense).  

Another option is to finance it at the time of transfer/purchase with a purchase loan (to payoff the existing mortgage).  Do the rates for purchase loans and refinance loans differ?  and is it harder to refinance than get a purchase loan?  If he gets a purchase loan, will that complicate the purchase process more (i.e. make it more expensive) than if a simple title transfer is done?

I apologize for so many questions, hopefully I don't confuse you guys too much :)

Bryan, welcome to BP!  I'm also interested to know what kind of deals you have.  Would be great to network. :)

Awesome, that doesn't seem like too big of a job, it's pretty much the usual things that I take care of as well.  

I agree with you on the fact that good repairs will help the unit rent faster and keep the tenants longer.  I have a tendency to over-repair and I'm trying to balance that, but I'd rather over repair than under repair as I do find that it's so much easier to find a good renter quicker, especially when your unit is better than what the competition is offering, it will definitely stand out.

Let me know if you end up purchasing flooring, cabinets, etc yourself, I can suggest some  places I've used so that you don't pay more than you have to for the material.  I usually pick the material myself and just have someone do the labor, in most cases.

Chris, congratulations!!

Just curious, what kind of work does the property need? And I'm assuming you purchased it via the MLS - was it a bank owned property?

Hi Leyla,

The current market in Sacramento has grown in price significantly in the last year or two and what you see on the MLS are usually not very good deals (or if they are, they are gone within a few days to cash buyers) so you are very unlikely to have a chance to assign a contract, the seller is very unlikely to agree to that when they have enough direct buyers with cash. If you are trying to wholesale, you would have to find deals that are off market, not on the MLS. Manuel's suggestion is a good start. If you do have good deals come across your place, I'm interested in hearing about them :)

Hi Bobbie, welcome to BP!  Good luck in your search, it's tougher to find good deals in Sacramento than it used to be but they are out there, networking is almost a must so good to see you here :)

Taylor, 

Gotcha, that was my assumption, just wanted to be sure :)

 Taylor, what specifically do you mean by 2-4%?  do you mean cap rate, % or rent to purchase price (as in the 2% rule), etc?

Thanks for the invite @Tapan Trivedi !  
I'd love to come only I'm in SoCal this week, hope to make it to November's meetup :)