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Congrats on the new crib! 130k seems like a pretty good deal for Lakewood for a move in ready. Duplex? How'd you find it? Any advice for others looking for good Lakewood deals? The competition is pretty crazy!
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- Aug 18, 2012
Congrats on the new crib! 130 seems like a pretty good deal these days for move in ready Lakewood. How'd you find it? MLS/zillow or off market? Any advice for others seeking lakewood property?
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- Sep 1, 2012
Single family. Looked for 6 months and 50 houses at least. It was listed previously but the deal fell through and ended up getting it for about $15,000 less than what it was originally listed for. just need to know what you want and be one of the first people in it once it's listed because houses are going within hours of being listed. The competition is real.
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- Jul 27, 2012
Before:
After:
Brand new aluminum garage door. Insulated w/ privacy window panels. Spent a little bit more $$$ for the LiftMaster wall mount garage opener. Got a killer deal on the garage door. Somebody ordered it and changed their mind. Got it for way below cost so I'm happy.
After:
Brand new aluminum garage door. Insulated w/ privacy window panels. Spent a little bit more $$$ for the LiftMaster wall mount garage opener. Got a killer deal on the garage door. Somebody ordered it and changed their mind. Got it for way below cost so I'm happy.
sneakaprince
Supporter
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- Apr 29, 2007
Need some unbiased advice
Working on my 3rd crib (kind of second investment property). My friend and potential business partner wants to basically throw me a duplex, (he has 50 units and is looking to turn the money from the sale back into a potential 8 unit venture with me).
Anyways he assisted me with finding financing, which would only require 10% down payment which he is even willing to credit back to me at closing. I'm essentially getting a free duplex which cash flows at about 600 a month profit after expenses.
The financing is my concern. My credit is great (760+) and the bank he's connected with wants to charge me 6.75% interest and put me on a ARM (5/1).There's no balloon payment but I know this rate is high and ARMs scare the **** outta me. This is the only bank I know that will accept a 10% down payment (which once again cost me nothing). Should I take the loan and just plan to refinance ASAP or should I look around. I really don't wanna come outta pocket 20% since I'm working on acquiring the 8 unit as well.
Working on my 3rd crib (kind of second investment property). My friend and potential business partner wants to basically throw me a duplex, (he has 50 units and is looking to turn the money from the sale back into a potential 8 unit venture with me).
Anyways he assisted me with finding financing, which would only require 10% down payment which he is even willing to credit back to me at closing. I'm essentially getting a free duplex which cash flows at about 600 a month profit after expenses.
The financing is my concern. My credit is great (760+) and the bank he's connected with wants to charge me 6.75% interest and put me on a ARM (5/1).There's no balloon payment but I know this rate is high and ARMs scare the **** outta me. This is the only bank I know that will accept a 10% down payment (which once again cost me nothing). Should I take the loan and just plan to refinance ASAP or should I look around. I really don't wanna come outta pocket 20% since I'm working on acquiring the 8 unit as well.
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- 4,758
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- Nov 6, 2012
Personally I wouldn't get an ARM at 6.75% on a duplex. Profits will diminish quickly unless you refi.
So if you plan on refi'ing soon it might not be too bad.
From first glance it just seems a lil fishy, could just be me though. I don't know the guy.
So if you plan on refi'ing soon it might not be too bad.
From first glance it just seems a lil fishy, could just be me though. I don't know the guy.
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Just know that interest rates are expected to go up this year, and in the coming years. Expect your payments to go up every year, if you're still cash-flowing considerably and don't have issues with it.. why not? I would not want an ARM personally.
I'd look into seller financing (investopedia): "Seller Financing is just what it sounds like: instead of the buyer getting a loan from the bank, the person selling the house lends the buyer the money for the purchase. The buyer and seller execute a promissory note providing an interest rate, repayment schedule and consequences of default."
If he's trying to hook you up, let him hook you up, cut the bank out and make payments directly to him.
I'd look into seller financing (investopedia): "Seller Financing is just what it sounds like: instead of the buyer getting a loan from the bank, the person selling the house lends the buyer the money for the purchase. The buyer and seller execute a promissory note providing an interest rate, repayment schedule and consequences of default."
If he's trying to hook you up, let him hook you up, cut the bank out and make payments directly to him.
glennvagmire
Banned
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- Jun 30, 2015
I see there are plenty listed in Lakewood and Parma.
Are they worth it? Is there a reason those in particular haven't sold in hours?
sneakaprince
Supporter
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That's where the issue lies. I am cash flowing considerably at first but unless I sell or refinance before year 8 my interest could go up to 12.75% which is absurd.
I spoke with the banker who was honest when telling me that they usually offer services to people with bad credit or investors with a lot of property. I'm only on my 3rd deal so it's not crazy appealing for me.
pdino
I know the seller can't afford to do that type of financing. He has 50 units so he's doing well but he expanded a lot in a little time. He's also working on a restaurant so I think his reserves may be a little low. I can say he's very legit and I've watched his business for a while so I'm competent that he's not out to play me. I just think he's a couple steps ahead of me where he can take the risk of accepting an ARM loan whereas I can't (yet).
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- Jun 9, 2014
Because it's an ARM loan I'd only accept if you were able to get from under it quickly if things get out of hand payment wise. I've worked with servicing mortgages for the past 5 years and ARM loans seem to catch that majority of people sleeping and hits em hard and they always call in to be rescued when it's too late. So either have an escape plan to mitigate risk or at the very least understand what your getting into.
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Have you thought about going to a different bank that requires 20% down. He said he's going to credit you back 10%, so you would get another property at 10% down with a 30yr fixed. Unless he's only willing to work with that bank.
sneakaprince
Supporter
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I think that's the more appropriate play. I was trying to come into this deal with no money outta pocket but you guys are right there's too many variables to gamble with ARMs, especially considering the neighborhood isn't as favorable.
Appreciate the advice fam.
I reached out to another successful investor and he hustles I start going directly to banks and looking at more of their foreclosure packages. I have a decent amount of liquidity right now I need to make the best play for multiple units.
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- Dec 28, 2004
Any way to look at the taxes owed on a home you're looking at purchasing?
Detroit got homes for cheap, but you're responsible for back taxes...?
Detroit got homes for cheap, but you're responsible for back taxes...?
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- Sep 15, 2012
Closing date window on my new construction just got moved from April/May to locked in on March 13th.
Probably going to go with a 5/5 ARM. Interest rate advertised as 3.25% with no points. I hope my 792, and my gf's 820 score gets us the best rates.
Probably going to go with a 5/5 ARM. Interest rate advertised as 3.25% with no points. I hope my 792, and my gf's 820 score gets us the best rates.
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- Nov 17, 2013
This is one of the most inspiring threads on NT.
I really hope to follow in both the footsteps of my family and the NT fam here with regards to RE.
I really hope to follow in both the footsteps of my family and the NT fam here with regards to RE.
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- 4,758
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- Nov 6, 2012
Closing date window on my new construction just got moved from April/May to locked in on March 13th.
Probably going to go with a 5/5 ARM. Interest rate advertised as 3.25% with no points. I hope my 792, and my gf's 820 score gets us the best rates.
Why do you want an ARM?
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- Sep 15, 2012
It makes a difference to us in the payment, to the tune of about 300 bucks a month (3.25% interest rate vs 4.5% interest rate makes a big deal). Now that doesn't sound like a lot, especially when you are splitting it between two people. However, my gf attacks her student loans pretty hard: $3000 each month, and she wants to be able to continue to do that.
Plus, we like the security of knowing that if one of us was fired tomorrow, we could handle the mortgage on one of our salaries. You never know what the future holds so we like to have a bit of breathing room.
Lastly, the rate is locked for 5 years. It's unlikely that we will be in this house for much longer than that. If so, we can always refinance at the end of that time.
- 4,758
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- Nov 6, 2012
Oh okay I've heard of people using ARMs for short term home purchases.
sneakaprince
Supporter
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- Apr 29, 2007
Yeah that ARM is much more favorable than the one I proposed this morning. Homie sounds like he has a plan set in place as well so he good.
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As far as Lakewood goes the west end is the more desirable side of town. Parma on the other hand is very spread out compared to Lakewood so there's definitely more "pockets" that are better but it's kind of a crapshoot, Parma definitely gets dogged by other suburbs as being trashy.
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- Apr 12, 2011
A little late but i would consider bringing in a partner to help with your down payment that way you can secure traditional financing. You lose some profit but you wouldnt have to worry about the ARM and you can stay liquid to get in the 8 unit.
Only you know whats best for your situation but it's another option you can consider.
glennvagmire
Banned
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- Jun 30, 2015
New Biggerpockets is about out of state rentals if anyone wants to know.
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- Aug 19, 2015
http://www.waynecounty.com/treasurer/treasurer_payonline.htm
Be careful buying homes in Detroit though. Not only do some have back taxes, but a lot of them need complete renovations including wiring / piping as thieves ransacked houses for the copper. A $2k house might end up costing $30k to even make it livable.
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- Aug 19, 2015
Anyone ever had an egress window installed / dug out?
I currently own a 2 bed, 1.75 bath house that has 2 "non-conforming" bedrooms in the fully finished basement. Thinking of spending the ~$3k to have an egress window installed, so that the home can become a "legit" 3-bedroom house.
I currently own a 2 bed, 1.75 bath house that has 2 "non-conforming" bedrooms in the fully finished basement. Thinking of spending the ~$3k to have an egress window installed, so that the home can become a "legit" 3-bedroom house.
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- Dec 28, 2004
Thank you for answering. Came across this info. seems like a bit of a crabshoot. got a lot to learn.
talking to some of my coworkers, finding out if there are any past permit issues/renovations is an issue too.
