All Forum Posts by: Vanessa Brostovski

Has anyone had any experience with negotiating the price of a home down because of the size? For example, a 3/2 versus a 3/1? I am looking at a deal that is priced well, but wondering about how much negotiating room I have due to the fact that it has 3 bdrms but only 1 bath, which makes it inconvenient for a family. This deal may be a potential assignment but I want it to be attractive to my investors, and if I purchase and hold, I want to be able to rent or seller-finance the place out. What is your experience as investors with the sizing issue, especially with the bathroom? I have heard that is approximately $5k in negotiating, but I want to be sure it's even something advisable to pursue, simply on the issue of the bathroom. Thanks guys!

I have a question about submitting offers. Suppose I have found a deal that I have run all the numbers on and looked at. The property is listed by an agent but is NOT an REO or short-sale. Should I find out if they are willing to seller-finance the property first before submitting the offer, or should I go ahead and just submit the offer anyway with my terms? Since I am not dealing directly with the owner, sometimes the realtors are hesitant to help find owner-finance deals, or land-contract deals, etc, seeming like you have to find a way to figure it out. Since i am new at it, I just wanted to figure this whole part out.

I have a general question. How did most of you who are seasoned investors start out with understanding contracts and how to have the right contract for the deals you were working on? Is there a good place to learn all about contracts and how they work? Other than just being able to identify a good deal, its important for me to know how to get everything together properly. Thanks!

Jon, thanks for your quick response as well. This wouldn't be a scenario where we are obligated to do a contract, but I'm sure he wants it to be a good deal and we are taking the risk of paying out of pocket if we go negative OR just breaking even enough to pay him out as I said above. So...we have to do a lot of work on looking into the deal and holding costs...

Scott, yes I was referring to a family member in our particular case with this deal. Although we do not have to do a contract with him, we want to make sure that, like you said, the relationship doesn't go sour. Based off the numbers on this deal, the concern is being able to walk away with some of the profit after the rehab and paying our family member back. One of the scenarios is that you can end up with nothing, of course, and the private lender can get back their money and their percentage...but you put all the work into the deal and paid carrying costs...etc. So, I see how you can say its the wild west, because it is pretty iffy. However, I am strapped for my own cash to put in and my credit is GOOD but I can't get mortgage loans right now, so using OPM and making a deal win-win for both parties is the challenge I face.

Scott--thanks for your reply. That's basically what I was talking about and explains it for me. I am currently reading the laws in California regarding land contracts, and they are pretty clear (surprising!) so far. I was looking at both of those scenarios, having someone be a tenant and also having someone buy it from me but I know then I would have to have enough of a good deal to pay off the seller and obtain title. Thanks for your help!

Seems like I've been full of questions since deals come up now that I'm in real-estate investing! I have another question for those of you out there....there is a good deal that has come up for me and my partner and the confusion is coming from how to deal with private money. In this scenario, some if not ALL of the funds for the deal will be from a private (not HARD) money lender that we know. However, since this is a rehab deal and will be sold (not sure if it'll be held for 1-6 months), how do you pay out your private money lender? Contractually, do you promise them a certain percentage? However, what if you don't deliver on that certain percentage, i.e. 10% profit on their money, if the deal goes sour after you have purchased it? I guess, without getting specific legal advice, how does it work with the amount you pay back to your private money lender. For example, if they give you $80,000 for the deal and your numbers don't work out when you sell the deal, and you'd promised them $8000, ? That's basically what I need to know, to ensure that no relationships go sour in the process.

Thanks Jon. My partner and I are also researching whether or not a land contract being subleased out, even if allowed by the seller in the contract, can trigger a due-on-sale clause if the bank can see what you recorded. These types of creative financing strategies do seem to require a lot of research:) But thank you for your detailed reply!

I have a question for those who have experienced being a buyer using land contract. In California, this is also called a sales contract. My question is, if I purchased a home via a land contract with the seller and they had done their research on me, how would it work if I wanted to then sell the property off to another buyer OR finance it out to them....has anyone experienced this? And also, has anyone experienced where the seller will prevent you from being able to assign or transfer the contract? I would be very interested to know about your experience with this and whether it was something do-able. Thank you!

one more thing, if you dont have enough cash yourself to do this, then how do you show proof of funds? I mean i can use my private lender but only to $100k or so MAX! Then i cant repair anything! So if its a deal at $120K + 10K in work and worth $190K ARV, its over what i can show, so are you getting the person to sign a document BEFORE hand then making offers using their proof?