Some Updates

House #1

The last I heard from the potential renter was last Friday with an email that said a family member had to go to the hospital. She sent the email using an account that had a different name than her - possibly a friend? Anyway, I responded back (last Friday) that she could fax me the completed lease application that day before 4pm or we could meet at the property over the weekend so she could give it to me. I didn't get a fax on Friday nor did I hear from her over the weekend. I was going to call her yesterday, but got tied-up all day at work. The only number I have for her is her work number and they had closed by the time I could call. Today I was again busy in the morning, but set aside some time to call her this afternoon. I asked her if she was still interested in the place since I hadn't heard back from her. She apologized profusely and said she has been busy packing and going to the hospital to visit her family member, but that she was still interested and would fax me the completed app first thing the following morning. She said her current lease expires this Friday and she will need to be moved out by then. I told her the quicker I get the app, the quicker I can get back with her on a decision. We'll see.

4-Plex

This isn't going so well. The more I think about this property, the more I'm questioning if the $300/mo+ CF is worth me jumping into a property that may be headaches down the road. You may recall my talk with the Seller last week in which he said it still needs some work done, including "running a new electric cable to the street" (which he got a bid of $900 to do), among other things. My wife is also totally against it, and I've learned that she (or maybe all women?) have a sixth sense about these things.

My original plan was to get an 80% LTV conventional loan and pay the rest with proceeds from exercising my stock options and taking out a small 401k loan. Until I could get the 401k loan paid off (probably within 9 months), I wouldn't have much CF (if any). Plus, I'd still have to make some repairs in the meantime in order to get the other two units occupied quickly. Once those two things happened, though, I'd be cashflowing steadily. To take much of the burden off of me, financially, up front, I decided to do some number crunching and sent the agent the following offer:

1. I would try to get a conventional loan to cover 80% of the purchase as before with the stipulation the interest rate would not exceed 7.5% and be amortized for no less than 30 years with a balloon payment due no earlier than 10 years.

2. The Seller would take back a note for the balance (20%) of the purchase with a stipulation that the interest rate would not exceed 6% and be amortized for 15 years with a balloon payment due no earlier than 5 years.

If you recall my talk with the Seller, he didn't want to owner finance any part of the purchase, however, he said at the end that if it's what sold the house he'd do it. So, I'm banking on this being the make-or-break item. If he accepts, a lot of the upfront financial burden will be lifted from me, and I'd be in a better position to handle repair work as it came. We'll see how that goes as well.

TheFastLaneToMillions.com

I saw this mentioned on Kenric's web site and I went to check it out. I must say I was impressed with the way the forums are managed and decided to register. I hope to not only get some good advice from people who have "been there and done that", but also give some OJT experience/advice of my own.