All Forum Posts by: Burt L.

I am running into this frequently and looking for a way to work around. In a strong local market, income properties are often listed in stating that offers are being taken for x number of days, and acceptance will be x number of days afterward. This drives me crazy as the listor is looking for more than the list price regardless of whether there are other competitive offers or not. 

On this 4-plex, I made a full price offer with no buyers side commission payable, title insurance and closing costs buyer paid,  no appraisal contingency, and sent a copy of bank statement showing more than sufficient funds for cash puchase (account number redacted) with a 12 day closing and an inspection clause. I made the acceptance date prior to the end of the timeframe offers were being accepted to see if it would be taken, and there was no response- as suspected. 

The end if the period for taking offers is end of business today and I have a message from the broker wanted to see if I am interested in the property, ignoring the fact I had already submitted an offer, which deadline has passed. 

At $700K with no buyers side commission (representing myself as I now do) and title insurance closing costs buyer-paid, I was already $20K higher on a net sheet to the owners- and still they are looking for more on a new offer. 

How can I break through this ongoing approach of trying to get me to out-bid myself? I dont know if there are even any other bidders, though it will be insisted that they exist. I would like to ask for a copy of the other offers, with entities redacted, but the broker will claim to be offended by this. Some brokers will even say that they had so many offers that they are asking one more time for highest and best to bring it further up, with no evidence that such offers exist. 

How can I find out what they really need to make this work, without the exercise in salesmanship? Broker has left a message asking if I am still interested - while ignoring my first offer - with the end of business today being a deadline for offers. I'm trying not to build resentments. 

I certainly would have preferred to have the property under contract prior to working through the un-released lien issue. The sellers attorney recommended she not sign the contract until it was resolved, unless there was a provision that the seller could cancel the contract if a lien was found. My attorney said the reason for that was that the seller then could try to raise the price to cover the lien, and sell to another buyer, in the hot market. It was for a mortgage of 58K taken out in year 1984. I was at risk the deal would fall as the sellers attorney had forced the issue before the property was under contract. The rule of the road is to get the property under contract first and then work through any title matters. 

In the end, my attorney located someone at the original mortgage company who agreed to sign an instrument stating that no monies were owed but the original note was long gone. I think they are used to getting these calls and make $125 each time. Most interestingly, the title company had already said they were willing to "not recognize" that lien and said they would issue title insurance anyway. My attorney was a little suspect at why they would be willing to do this, and said I may have issues on my resale if not at the same title company, or by any future seller after me- but that my liability would be limited to the increase in value above the amount of my policy.  My view was that after dozens of closings at that title company they were willing to be helpful, but I did follow the attorney's skepticism on this. 

Regardless, it was resolved and is now under contract. Thanks to all for another case solved with the help of BP!

It looks like the Richard Gill Mortgage Co became Gill Savings and then went through this list of acquisitions of its assets. If I click on the last one, it appears to be part of Bank of America now. Maybe they would be required to release the deed, though it may take longer than a Quiet Title action without an Answer being filed?

Might have to copy and paste this link if it doesn't work automatically.

http://www.usbanklocations.com/gill-savings-associ...

I've been working with the seller for a long time and she is now ready to sell. I had an O & E run and it shows a DOT and a mortgage of $56,000 borrowed 33 years ago. The owner received the property in a divorce ten years ago.

Her attorney says it cant be sold unless the mortgage company - a Richard Gill Mortgage Company located in Texas, releases the deed on this Colorado house. The only way is that if I take it subject to the potential debt and the title company cant issue title insurance with the note being released.  Seller assures me the 30 year mortgage was paid off 10 years early.

The Richard Gill Mortgage Company seems to have disappeared and there aren't any assignments of the note. Is this a dead deal now, or is there an alternative way around this? Thanks for any input - I seem to have hit the end of the road on a long deal.

I appreciate the reply. The same size lot next door sold for 300K plus the costs of doing an asbestos abatement and then a scrape. Based on rents of this older six plex, it has a value of approximately $600K so its apparently still the highest and best use.

I am looking for a way to show a buyer there is additional value to a residential landlord thata developer will eventually want to put 14 or so townhomes on this lot as well but its hard to quantify to that potential residential landlord and I'm reaching above my current residential experience base.

How might I present this to a residential landlord - that there is additional value in the property?

I have a worn 6-plex under contract that is next to a lot where 14 new townhomes are being built. Next to that is a lot with 20 townhomes that are probably 25 years old.

The lot the six plex sits on is the same size as the the 14 units under construction, each 19,000 sq ft. All my buyers are residential landlords and wouldn't be able to look past the current use of the property and wouldn't see any value beyond the cash flows of the six units. Rents are sky-high and seemingly ever-increasing currently as is widely known.

The deal as a straight six units is good, but not great. The lot is zoned to allow three stories high construction, as is being built next door. How can I show that there is value beyond the value of the current cash flows, as buyers wont acknowledge it has any greater value unless I can show them. This property was formerly a 6,000 ft single family that was legally divided into 6 apartments, each with exterior access.

Unfortunately, the lot next door didn't sell at a price that was attractive on its own relative to the price of this operating property so the lot value alone isn't a convincing figure. 

I can see buyers complaining that the deal isn't good enough, while knowing the future value isn't quantifiable right now, but will be happy to put that value "in the back-pocket" for the future.

How can I present this deal in a better light that gives it additional value for how properties are being developed in the immediate vicinity? As a wholesaler I find sometimes the biggest issue is identifying the value of a higher and better use and convincing buyers. I seem to have had good luck at this in dividing duplexes, etc into individual townhomes, but these units are also vertically stacked so don't qualify as townhomes and would have to be done as condos, which is a much more demanding and costly process.

I try not to give away identifiable value, but haven't been able to quantify any identifiable value other than to simply say a developer will likely want to buy this and scrape it someday - but that doesn't translate to current value for my residential landlord buyers as their formulas are steadfast.

I will certainly inquire about how I can write a contract with "an additional minority interest who might yet be identified by a court".

Otherwise, I have to negotiate separately with the sister after the probate court has ordered the title percentages be "corrected" to where they probably should have been 18 years ago if a timely probate had been filed. Although the siblings have strong, long-lived differences - at that point they will both benefit from a higher price for the property after the legal work has been done and the sister could hold out for a ridiculous price and I cant do much with 75% the interest in the property. A partition action essentially requires it be sold on the courthouse steps to the highest bidder.

My experience is that the longer a property goes without being under a fully binding contract, the more the price keeps going up. I will be thanked for my help, but will hear'" we still  need to get more for the property" after the title/probate  matter has been cleared and the sister is not bound to the initial contract with the other 75% ownership.

I have been working with a couple who own a duplex with the father/father in law who died 18 years ago and it was never probated. 20 years ago the husband and father in law bought the duplex as tenants in common with each owning half. 2 years later the father in law died, having two daughters and no other heirs. Thus half of the deceased fathers half of the property would go to each of the daughters, leaving the married couple with 75% ownership, and the other sister with 25%.

After having a trusted attorney research the situation, I learned that since three years have passed that its too late to probate the property (there was no probate at all) but that an abbreviated process called a "Petition for Heirship" is undertaken. In this process the sister/wife who lives in the property with the husband files petition with the probate court (not a formal probate) sends letters to each of the heirs stating in this case that each will receive 25% ownership and if there is objection then a formal hearing is held. If no objection then the court enters an order that each sister receive 25% ownership and sends the order to the recorders office, which changes ownership in  the records. This all sounds quite streamlined, unless there is objection.

I would like to put the property under contract, and have offered to pay the legal costs which are about $1,500 if no objection from the other sister who lives out of state. Unfortunately, I cant put the part of the property that the out of state sister owns under contract, as she's not on title yet, and has proven to be contentious with the resident couple, but she has stated that she agrees she will ultimately own 25% of the duplex. /

Its been suggested I put in the contract that "Closing will be 30 days after Court/Attorney approval".

This is fine, but I don't have agreement from the final 25% ownership of the property. My concern is that after the process is completed, the price wanted for the property will immediately increase dramatically if I don't have agreement beforehand. Its seems that I can only enter into agreement to purchase 75% of the property, unless I enter into agreement with the contentious sister now, who the married couple want to leave out of this and just want her to sign off on the court petition without further involvement or being notified of anything else now.

How can I put  myself in the best position to obtain the final 25% ? The price I put in the contract will be for entire purchase amount, which the other sibling will receive a prorated 25% of. I may have to increase her compensation for the final 25%, but the 75% ownership purchase price will be locked in. I need to have some language about the final 25% in the contract but wont have the signature of the other, non-resident sister.

This is an odd one, as there is no Personal Representative that can legally bind the other sister. The property is very poor condition in a good area and worth rehabbing.

Here's a better response - been having a funky day:

If we assume this is legal and avoid RESPA conversations - how could I do this rather than "can I do this"?

Title co attorneys review and allow this so I would prefer not to make judgments on what's legal or not. If we have already made it as far as "this can be done" on the greater decision tree, how could I do it?

Didn't want to go down this road in the thread, especially not so early. But I've done it or seen it done hundreds of times. 

Looks like the death-knell for this threads inputs.