Posted by Ed Garcia on August 09, 2011 at 11:22:11:
Russ,
The retail market is defined by RETAIL SALES.
Local Realtors will give you retail comps; I get my comps from Title Companies. On the Internet you can look up zillow.com, but be careful Zillow is usually about 10% high.
Hard Money Lenders lend at approximately 65% of purchase price depending on the lender and what you can negotiate.
Ed Garcia
ideas for a partnership - Posted by joanneCA
Posted by joanneCA on May 31, 2011 at 11:12:41:
Need help with my thoughts on partnership. Would this work:
I pay down payment and mortgage payments. My partner provides credit. Our contract is formed via LLC. The property is about 150K and we agreed to sell in 2 yrs or later, but later only under mutual agreement, if and only if we’d need to wait for the market and price to go up and hopefully reach a 300K. sale. 150K profit is split where I am getting 50K and the partner 100K. In case of a smaller profit achieved, all profit would go to him.
Here is what I would gain: Savings of about 2K each month on mortgage or more. (Now renting). Would allow me to start investing, possibly in fixers, possibly with same partner.
Here is what my partner would gain. Under one scenario, assuming he is one of those professionals who got properties for 700K just a few years ago in CA – he could have 5 partners like myself plus own mortgage and without much effort could gain 500K in a short time.
Yes, I tried many things to get a better credit score but it was time consuming and did not work and the time to invest is here.
Hope your answers will be of value for others as much as for me. For me your answer might open a world of possibilities. Thank you!
Re: ideas for a partnership - Posted by Ed Garcia
Posted by Ed Garcia on June 05, 2011 at 11:48:26:
Joanne,
I can see by your JoanneCa, that you?re from California.
I?m also in California. You?re talking to us about structuring a deal with out telling us about the deal. You say The property is about 150K and we agreed to sell in 2 yrs or later, but later only under mutual agreement, if and only if we’d need to wait for the market and price to go up and hopefully reach a 300K.
Joanne, that?s a tall order. When doing a deal, we make our money on the buy. If your deal is bought at 60% of today?s market I can get you a hard money loan and you won?t need a partner. If you think the property is going to double in value in the next two years, I?m afraid you?re mistaken.
Joanne I?m not comfortable that you?re deal is a deal the way that you?re presenting it. I need more information to see if it?s a valid investment or just a way that you?re trying to buy a house. I also think that there are many ways to structure this deal if it?s a make sense deal with out taking on a partner.
If you like you can call me at 909-944-0199 and we can discuss your deal. I may either help you finance it or help you restructure it to make sense for a private investor or partner.
Ed Garcia
Re: ideas for a partnership - Posted by Randy (NY)
Posted by Randy (NY) on June 01, 2011 at 11:33:26:
Joanne, I don’t like trying to deal with partners. It’s the old, “too many cooks spoil the broth” syndrome. Strike out on your own. It’s simpler and faster to do so.
If cash/credit is the issue, learn to invest creatively. I started out years ago in the same situation you describe. Decided to make things easy on myself and used lease options as my starting point and then grew from there. Best decision I ever made.
Re: ideas for a partnership - Posted by JoanneCA
Posted by JoanneCA on June 05, 2011 at 21:11:38:
Mr. Garcia,
Thank you so much for your reply. In the late nineties, I still lived in NY, I actually spoke with you on the phone and received a great advise. Today I don’t remember details but it must have been ref structuring an investment deal.
Today I live in San Jose. Prices here are still very high and no, I have no specific deal in mind this time, just thinking and hoping. I found some areas between here and Sacramento and in Sacramento where a SFR, a large, newer construction, can be purchased for about 150K. In fact I found a few with 4 bedrooms and 3 bathrooms. Estimated payments are about 900 per mo plus taxes about 400. Even if it would be a bit higher, I could rent two rooms out and have a very small monthly payment at the end. Considering my income, this would give me a great opportunity for savings and investing. But I never managed to overcome my student loans situation and low credit scores… so it is still likely just a dream… (:
On the 10th of this month I will have a closing on a small cash investment in Chicago and was hoping to achieve this way a down payment, but it will not be a 40% on any of the CA prices.
It was a great feeling to hear from you again and when I will have actual deal to structure I will write again and possibly call. Thanks!
Joanne
Re: ideas for a partnership (personal property) - Posted by joanneCA
Posted by joanneCA on June 01, 2011 at 12:22:08:
Thanks, and I understand what you are saying but cash is not my problem, only credit. L/O would not solve my problem, I am already paying too much in rent. As soon as I get regular mrtg payments, given only to good credit ppl, I am making almost 3K each month! Don’t you think my idea would be beneficial to both parties? L/O also involves two… (:
Re: ideas for a partnership - Posted by Ed Garcia
Posted by Ed Garcia on June 05, 2011 at 22:03:54:
Joanne,
I wasn?t implying that you put down 40%. If you were to buy a house lets say at 30% below market with 10% down, you?re in the game.
If you were to go with 60% financing, 10% below market on the purchase with a seller carry-back of 20% and 10% down, you?re in the game again. Joanne, I?m just warming up, there are a lot of options available it depends on the deal.
I think what you?re looking to do is have a game plan before buying so you can go make an offer, we can talk about that too.
Any time you want to chat, feel free to call me Joanne and we can talk.
Ed Garcia
Re: partnership (not Bill Gattenâ??s PacTRUST) - Posted by joanneCA
Posted by joanneCA on June 01, 2011 at 12:39:29:
The only difference I see btw this and Bill Gattenâ??s PacTRUST is that this would be a regular, conventional transaction… My partner’s credit could not get hurt yet it would turn a profit for him in a short time via equity…
Re: ideas for a partnership - Posted by Russ
Posted by Russ on August 07, 2011 at 14:42:50:
Ed,
When you say below market value you mean what comps are in the area correct? How would you determine a true “retail” market value with so many houses being sold by the bank to investors well below retail. Do I just isolate the traditional seller to buyer transactions to determine market value? Any help you can give to help me understand what hard money lenders are looking for would be appreciated.
Re: ideas for a partnership - Posted by JoanneCA
Posted by JoanneCA on June 06, 2011 at 05:32:13:
This makes me feel like life is still out there! (: (: I guess I didn’t think about RE for a long time now… I am going to try and find a deal or a deal sample and come back and present it here and see what happens. Thank you!