OfflineHi. I am a new member. I started Dean's course 1 and 1/2 weeks ago. I was totally excited, til today. I put an offer on a 29,000 house on Friday, and they said they wanted proof of funding. With our credit score, thought, no prob. Called broker today, and found out that not only am I not qualified, but most folks aren't anymore, due to the closure of subprime lenders, which I did not know about either. so finding motivated buyers is probably no longer a viable option, unless they are cash or seasoned investors. It seems that is the only workable strategy now. I have been considering what to do all day, finally decided to buy the cottage on my credit card, Have a renter, it's ready to rent. It's an awesome little house. With the removal of 1/2 a wall to open it up,(the living room is too small), and planting some flowers, trim some trees and bushes, I am sure I can sell it for 39,000 easily. there are several people waiting for me to back out due to lack of funds. I'm just determined enough not to. Any ideas out there? The prop. is for sure below FMV, and I really want to start, and it seems like a god send. tina
Shall I put it on my credit card?
Posted on: Tue, 03/10/2009 - 04:14
Maybe the credit card is the way to go. You say you are sure that you can sell it for 39,000 ... really?
Here is a link to a posting with a funding source if you want to assign it. I am not 100% sure if anyone has had success with this company though, I have asked many times.
Read it through, check out the web site and call and talk to the contact at Coastal Funding.
http://www.deangraziosi.com/real-estate-forums/financing-and-credit/1344...
Good Luck either way!
Angela
hey thanks. I'm pretty sure, here there is nothing decent under 75,000. A comp sold for29K recently, same size, but needed lots of work, $. Also, a single mobile sold for 30K bu still a lot of 4 and work. Seems like for even 42,000, the right buyer could live there cheaper than rent. And it's really cute!!
Sounds like a deal!
Keep us posted, if you run into problems post and ask for help. As new as you are to the site, I am sure that you will know by now that we are all here rooting for each other.
Angela
wondering if one can still find qualified buyers out there, or are you all just pretty much working with cash investors? should I still market for motivated buyers, or are obsolete, like no more subprime lenders for them?
market away!
Craig's List is a great place to start.
Go to the site,
do NOT click on the real estate section first,
click on the SERVICES section and there click on the real estate section
then click on the finance section.
You might be surprised what you find there!
Also, post yourself and look for qualified buyers, just keep posting.
You will find what you are looking for, you just have to keep at it.
thanks again Angela, I will do it. Blessings and good night.
Before you put that on your cc, I would go over you financial stuff with a fine toothed comb. First, make sure that you have your cash flow analysis down in cement. Don't forget anything: taxes, landlords property insurance, water/sewer/trash (if you have to pay that as a landlord), maintenance fund, property mgmt services, typical vacancy rates in your area (you can get that figure from a property mgmt firm), seasonal landscaping costs, etc. This will give you your hard costs each month.
Then, go over your credit card agreements and MAKE SURE that you are 150% clear on exactly what your monthly payment will be once you put this on there. Make sure that you know whether this will go as a cash advance or a purchase - it impacts your interest rate and the order that things get paid off on the card. Make sure that you know if and under what circumstances your cc company can raise your rates - that is happening ALL OVER THE PLACE right now - and not only because of a late pmt or over limit - they are doing it just because and getting away with it. They're also going in and lowering the credit limit on cards - oftentimes to BELOW the current balance. If they do that, you have to come up with the difference in cash or you will be totally screwed.
So, then you have to put in your worst-case-scenario cc pmt into your cashflow analysis and see if you can still cash flow what you want from the property.
Don't get me wrong, I'm not against using cc as a stop-gap financing solution, not at all. I'm just horribly untrusting of cc companies, I've seen what they do, and if you're credit score is considered subprime, I think they would see you as fishbait - a target, and you could end up in an unhappy situation. My bro-in-law uses cc this way all the time, but his score is over 700, and I think that has a lot to do with why he doesn't get messed with.
Just saying to be cautious, and double-check EVERYTHING. Then, if you're confident, GO FOR IT!!!
PS - it's killer that you already have the renter lined up! Good job! You can see about selling to them at the $39k price in 12 months - hook them up with a mtg broker who can show them how to get their credit score up where it needs to be (and have the broker work with you on that, too). Then, look at Greg's strategies in the student secrets book that came with Dean's new book. I think his end-buyer strategy would work great with you. There's a couple of other students in there who are doing that too, sort of a rent-to-own thing with their tenants.
Good luck and keep us posted!
Tracey