My first lead - Next Step?

[chunkoftheearth]

NSU: This is a question that has come up more than once from more than one person and both you and Tony haven't given an answer.  In this scenerio, what would you advise Mr. E do if the market tanked another 10%?  What would be your advice to him to somehow overcome that?  Imagine this were a deal you had advised him to sign up back in 2008, then tell us what he should do.  By the way, I wasn't advising at any point doing this deal.  We haven't even dealved into whether or not this property needs repairs.  What should he do if it does NSU, should he artificially hike it up another 30k without the comps to support it?  Other question for you NSU.  Since you sign BS deals like this one, tell us also of a deal in which you actually wouldn't do.  Curious in your opinion what would make a BS deal.  I'm listening 

[nsu1997]

NSU: This is a question that has come up more than once from more than one person and both you and Tony haven't given an answer.  In this scenerio, what would you advise Mr. E do if the market tanked another 10%?  What would be your advice to him to somehow overcome that?  Imagine this were a deal you had advised him to sign up back in 2008, then tell us what he should do.  By the way, I wasn't advising at any point doing this deal.  We haven't even dealved into whether or not this property needs repairs.  What should he do if it does NSU, should he artificially hike it up another 30k without the comps to support it?  Other question for you NSU.  Since you sign BS deals like this one, tell us also of a deal in which you actually wouldn't do.  Curious in your opinion what would make a BS deal.  I'm listening 

The market can always tank, but I already answered that. The answer is keep renting it to the tenant-buyer, or keep collecting payments from the new end-buyer. Just keep collecting payments. If the tenant-buyer moves out he can always just rent it assuming a reasonable underlying payment. Worst case scenario he could do a short sale, loan mod, or hell even deed it back to the seller.

Lots of people got caught with their pants down that bought at the top of the market. With many areas experiencing up to a 50% or more drop in values it sure wouldn't have needed to be 100% financed at that point in order to be in trouble. But in any case that's the business we're in. We can what-if to death, the real investors will keep making money while the chicken littles keep worrying about the sky falling. In this particular scenario if he deeds it directly to the end-buyer via sub2/seller financing in exchange for $10K down as I suggested earlier he's in and out. If the market tanks then too bad, not his problem.

He mentioned in the first post there are no repairs needed. Among other things, that's key on dealing with a 100% financed house.

I wouldn't hike it up $30K. Never said that. I would go $10K, maybe a lil bit more. It's worth more because he'll make it easy to buy.

IMO A BS deal is one where there is no realistic exit strategy. He's got several here. I didn't say it was an ideal, perfect deal. Just a doable one. Certainly a good starter deal for a well-trained newbie. Check that link I posted earlier and watch that video...may learn a thing or 2.

[chunkoftheearth]

NSU: I appreciate the reply.  And I am ok with you disagreeing with me.  It's cool.  Just a case here where it's about preferences for the individual investor.  I don't need to go to the link to see a deal of this sort be put together though because technically I already know what you guys are talking about.  It's just my preference not to do it.  For me, the deal has be make sense from the outset, right in the begining and this one doesn't unless you fudge the numbers.  Anyway, it's cool.  A complete newbie or even one that's well trained to strict to strategies that make sense though and not do what these other guys are doing because they obviously know what they are doing (shrugs shoulders).  Newbies are better off sticking to quality deals and wholesale type deals and not this crap.  So you mention possibility of getting into this kind of deal then if market tanks then do loan mod, short sale etc as possible exit.  Ok, wow, this is eye-opening.  No reason do even involve youself in a deal like this where the mort balance and valuation are the same.  Not prudent.

[TonyDiCorpo]

chunky i thought u got hit by a bus 

[chunkoftheearth]

I did, but then I recovered.  I mean, I had to so that we can continue our debates!  That, and I knew you missed me.  Tony D, you have to admit, when we speak, the masses watch.  Well over 600 views homey.

 

[spleano]

mortgage renewal?  ummm.....?

discharge the mortgage? ummmmm?

what legal fees?

Tony and chunky, You are both making good points, but I'm still waiting for someone, besides you two, to address the questions above. Do these things apply or not?