Recently, my wife and I started our journey into real estate. We read the books, listened to the podcasts, watched the tutorials, thought we had a good team. Then it all went south. We found a move in ready 2/2 condo/townhouse for a good deal at $82k. It had an active HOA, and was only $200 a month, and rent would be $1200. Boom we are making all of our numbers. Everything is going great.
Then we stumble across deal number 2. 3/1.5 SFH in a good area, interior completly renovated, with receipts, warranties, and contractor approvals. Listed at $105k, I throw out a $90k and 100% of closing offer with a home warranty, (I am thinking oh they are going to laugh but hey who knows) 20 minutes after we made the offer, it is accepted and they want to close on the same date as the other property. Everything is still going great.
Now at this point we are 27 days from closing on both properties. I live in PA and the properties are 2 miles away from eachother in Georgia. So with us being new, we thought with Georgia being a wet state, I had to drive down there to close on the houses. No big deal, I have an old Army buddy I haven't seen in a while.
We get an inspection on house number 2 just to double check things. Turns out there is a large leak in the roof, lots of soft spots, and the roof is original 1959. So we let the sellers know and they say, no problem well take $15k of the price, so now this how is $75k. They still are paying closing and home warranty.
About 5 days before we close, my lender (childhood friend) calls me and starts asking me tax questions about the house. Turns out it is managed by a trust, and some asian beauty salon uses it as their address. Well good thing to know, since the people selling it could not legally sell it. 1 crisis averted.
Back to house number 1. I drive down to GA to close on 1 property. Get there, decide to look at the property. it looks great. tenants are already lined up I can get them under contract the day we close. Day before closing lender calls and says, the condo division has to go through the contract again and they thought something was up with the HOA and should be sorted out quick. Day of closing, still waiting. Day after closing, my lender tells me they are going to deny the purchase because of the HOA. Turns out that the HOA only allows 50% investor owned properties and it was currently at 75%. instead of having 10% of dues in reserves they only had 2%, and 20% of properties were deliquent on dues by over 3 months.
Come to find out the Listing agent, knew all of this and was involved in the HOA, she is also my agents boss, and turns out my agent was the original agent when the complex was built.
All in all, was a great learning experience. Sorry to be long winded but thought I would share.
