All Forum Posts by: Robert Steele

Good luck. Two years ago I couldn't get any lender big or small to give me a even a measly $30K HELOC on a $250K property that was free and clear. I have/had excellent credit and at the time was still working as a professional making a six figure salary.

The lender I got closest to the goal with was Wells Fargo but after going to the underwriter the reason I was denied was because they wouldn't lend to anyone with more than 4 properties. Not mortgages, properties.

Don't panic.

Like someone said. Get one of those cheap mold test kits first.

Secondly, if your state law allows it, don't use a mold remediation company. Those guys are bandits!

Thirdly, tear out all the effected drywall/insulation and wash the studs with bleach and water.

Finally, if the first test showed a health issue then retest the property.

@Jay Hinrichs

When you personally did it as a lender you still had to pay the redemption interest to the investor correct?

Oh one more thing. Let's say this house is worth $500K and the taxes due is $50K. Someone bids it up to $250K. Now my understanding is that the previous owner gets the $200K remainder after the taxing entities get paid. 

So later the lender comes in and wants to redeem the property. They pay $312K. The lender has an asset worth $500K but they lost their original mortgage, say $250K. They sell for $500K and get all their investment back with no profit.

It seems like the previous owner just made out better than all of us. :)

@Roy Oliphant

Makes sense. Well 25% return in a few weeks is a pretty good investment still!

@Roy Oliphant Thanks for commenting. I don't see how the lender can redeem the property though? The Texas Property Code Sec. 34.21. Right of Redemption only mentions the owner. The lender is not the owner.

A friend asked me about a SFH being auctioned on the court house steps in a Texas county. At the conclusion of the sale I understand that the mortgage is no longer attached to the title. It becomes an unsecured loan (by the way the owner has no other real estate assets to get a judgement against). If the property is at say 65% LTV and we are talking a half million property what does the lender do prior to the auction - which is only a couple of weeks away?

Do they just let it go? If they do and the amount is for more than the taxes doesn't that money go to the owner?

Do they pay up the taxes and foreclose?

Do they go to the auction and bid? How much do they bid up to? It's not like they can do a full credit bid as they didn't win the judgement - the county taxing entity did.

All the tax sales that I have seen don't have mortgages because the lender would never let the process go this far and risk losing their security.

As a long time experienced landlord who knows other long time experienced landlords the best advice I can give you is; don't do it!

Large chunks of up front rent are a huge red flag that you are going to have trouble with that tenant down the road. Don't ask me why this is because I don't really know. It just is.

@Dustin N. Yes it's nuts. I'm in Collin County and even at the Trustee sales the prices are going for over MLS list. I guess these people are either noobs or figure that because everything that hits the MLS goes for above ask that they are getting a deal. Or they think that DFW is going to keep appreciating 10% year over year.

I'm just staying away. In fact I've been selling into this market for the past couple of years. I am only focusing on buying through unconventional avenues. I found one of those earlier in the year but it slipped through my fingers because I made a stupid mistake. So good deals are still out there, they are just very very hard to find.

Whatever you do don't pick that orange oak. Ugh!

White is back in style in a big way. Especially when paired with grey.