Hi my name is Jason I’m a new real estate investor (kinda new)
I’ve been investing for 2 years now and i own two homes.
I bought those homes convent. not creative style like “Sub To” or
Lease Option nor Wholesale. I simply bought them to rent out and still have them to this day. I got really into creative realestate about a year ago. I read Carlton Sheet’s "No Money Down course and from there it took off. I’ve read and studied now about 12 books and 5 courses on real estate. Anyone from, Joe Crump, Wendy Patton, David & Peter Conti, Kris Kirchner, Charlie and Randy France, Bill Bonchick, Dale west, Mark Walters, Scott Rister, Bob Meister, etc.
I love the idea of me buying homes like that. I’ve study about all the guru’s around and their style of buying real estate and i’ve learned
alot. I still fell i don’t know much about the paper work at the end of the deal (the offer and the closing) For example if i were to make an offer
for a subject to deal what would i need? What would i need to close the deal? (I’m talking about the paper work, The real estate forms)
I have all these real estate forms from guru’s and from web sites but i don’t really know which one’s to use with a certain deal?
help please!!
Explain what forms go with what exit:
“SUBJECT TO”
OFFER=
CLOSING=
“LEASE OPTION”
OFFER=
CLOSING=
“WHOLE SALE”
OFFER=
CLOSING=
I think those are the main one’s right?
Well if you can think of anymore write them down aswell.
Jason I’m not sure that I understand your confusion on the “sub to” paper work. Whether you are doing a “sub to” in a regular or preforeclosure purchase nothing has changed. You stated that you purchased 2 properties. Take a look at your purchase agreements for those and you should see an area in the financing section for “sub to” i.e assumption. Now the real question is whether you are going to close the purchase as an “assumption” with the mortgagee being made fully aware or close the purchase without the mortgagee being informed of the sale. I would guess that your exit strategy would dictate what paper work you would need to use. I know investors in preforeclosures that do not use purchase agreements at all, while on the other hand I do. We all use General Warranty Deeds, Same Name Afficavits etc. Hope this helps.
Hey Paul, Thanks for posting back to me.
Anyways about the first two deals i got,
I got those deals through a bank mortgage company i didn’t do the paper work. I’m talking about doing the paper work on a “Subject 2”
by myself. In other words there would be no mortgage company doing the paper work or a title company won’t be doing the work either.
It would be me by myself at the kitchen table with my sellers.
Let me tell you about the home and tell me what would you do and tell me what paper work i’d need o.k.?
and their two months behide.
But extremely motivated they want to move out like yesterday.
They would sigh over the deed to me and let me take over payments as soon as possible.
I want to keep the loan in thier name and they don’t care as long as
I take over. I can take the deed and lease it for 12 to 24 months
on a lease option to a tenant buyer for $210.000.00 for monthly payments of $1,350.00 and have a cash flow of $245.00 a month.
I’m i doing this right?
Jason Sarmiento.
Jason, I personally don’t do l/o’s. As far as getting the deal - here is the money - General Warranty Deed to you - Affidavit of Same Name - if you choose, Purchase Agreement stating purchase subject to existing financing assuming an approx bal of xxx with PITI of xxx Payable to xxx or something along that line. If money is payable to seller include that as well i.e. paid to seller xxx. - Limited Power of Attorney from seller - Strong Statement that seller understands that this sell is subject to your taking over their existing loan balance and monthly payments - I have this statement in several documents that the seller signs because when the stress of foreclosure is removed they sometimes tend to feel that you took advantage of them and they didn’t know that they were still legally liable for the loan that you assumed. Hopefully this helps. Just take your PA if you plan to use one and fill out the numbers. I am in Texas and this is basically how I do it. Of course you need to know what is acceptable whereever you are.
I am trying to understand if I can take control of a property via a lease option and use private lenders to fund the option consideration and fix up costs? My instincts tell me no, since I can’t give the private lender a note saying their investment is secured by a note on the property.
I’ve only heard of “subject to” being done in cases of a distressed seller. My seller isn’t distressed, just a burned out landlord with little equity in the property.
If I go with “subject to” and he wants some money up front, how will I account for that? Keep in mind that I want private lenders to pay for the acquisition and fix up costs.