Peeps,

My partner and I recently purchased three "Raleigh Shotguns" and have completed renovations on two of them. Due to the morons in the banking industry and the greed of the fast food employee purchasing a $400,000 home on $7.25/hr getting an approved buyer has been harder then expected. We've had plenty of interest and offers; however, no approved loans.

So...

We have decided to take on the burden of owner financing one of the three homes to the first taker. Of course, the interest rate will be higher then a conventional loan; however, if you or said buyer were able to refi at anytime we would appreciate it as you should too.

Details of home -
620 Sq Ft
1 Bed/1 Bath
Fully renovated with new plumbing, HVAC, and electrical
Refinished hard wood floors
Tiled shower and floor throughout bathroom, laundry room, and kitchen
New driveways and concrete paths poured to the front door
California closet in bedroom
6 ft privacy fence across the back yard and 3+ ft white picket fence in front yard and between the homes

Details of owner financing option:
Sale Price: $99,000
Money down: $5,000 (of course you can put down more if you want)
Loan: 10% APR 30 yr Amm
Monthly Payment: ~$830/mo

Now before you start flaming away at the monthly payment think about this... if you were to get a convential loan at a respectable 6% the monthly payment would only be ~$570/mo

Address: 123 or 125 Camden St 4 blocks east of Moore Sq in downtown Raleigh

Email me for pics or details.










[Edited on November 10, 2008 at 5:05 PM. Reason : .]

[Edited on November 10, 2008 at 5:16 PM. Reason : fulfilling omar's demands]

11/10/2008 4:58:52 PM

you are going to have a horribly hard time here with this crap - i mean it's only 620 sqft - but you didn't list the # of br/ba nor include any pictures

10% - i assume that part is just a joke

11/10/2008 5:02:48 PM

You may wish to take care in advertising specific numbers

11/10/2008 5:05:49 PM

is this an 'up and coming neighborhood'

11/10/2008 6:13:35 PM

Quote :

"Now before you start flaming away at the monthly payment think about this... if you were to get a convential loan at a respectable 6% the monthly payment would only be ~$570/mo"

So a 45% increase in monthly payment over a respectable (6%) rate is not something to flame away at?

Do you not think its excessively risky to offer financing to someone that can't obtain traditional financing?

Good luck, carry on.

11/10/2008 6:22:39 PM

you lost me at 'my partner and i...'

11/10/2008 6:23:38 PM

this makes me feel better because the house i just looked at had over 1000 sq feet, and 5 acres of land for 95k in durham

11/10/2008 8:17:34 PM

Quote :

"my partner and i"

wat?

11/10/2008 8:19:11 PM

he might meant business partner.

11/10/2008 8:39:09 PM

Quote :

"Total Value Assessed $29,365"

Well, at least your tax bill is going to be $Rhode Island.

I've got $45k on it.

11/10/2008 8:52:43 PM

4 blocks east of Moore Square = not gonna get $99,000 in the next couple of years

in the ghetto

11/10/2008 8:57:55 PM

Partner - Business Partner

Ghetto - completely relative. Take a drive down that way at anytime and come back and write up here it's ghetto. If the average black person happens to walk by you while you're looking at them please keep in mind you probably voted for Obama and think its great this country can elect a black man, yet you still check to see if your locks are down. Really... great. Anyways, if you do take the time to drive around down there you'll find the majority of homes up to that block have been/or are getting renovated.

*For any of those taking this seriously the neighbor on one side is a single black woman in her 50s who works for the department of corrections and bought her home back in '80. The other side is owned by a guy who's renovated quite a few homes in that immediate area. I won't go name dropping but it's one guy I'd hope most of you have at least heard of. (this in invite for someone to show off how they know to use the Wake County real estate tax site)

Finance Discrepancy - Fact of life. As I said we're willing to take the risk on of having someone carry the note with us. If you took the time to understand the financing, and time value of money, or how you can sell a note and make more money then you may not be questioning this so much. And yes, by all means we'd prefer a buyer to get his/her own note as we wouldn't mind moving on to the next project and avoid playing a bank. As for the risk involved, a lot of rental property owners or investors sell "owner financing" and prey on people foreclosing and due to the process being so simplified with a promissory note a person acting as a bank can many times make a lot more money foreclosing then selling a property in the conventional manner. So, no we personally don't want to prey on people but we also don't want an idle investment. Reward beats risk in this scenario thus the offer of owner financing.

Pricing - The most recent sale of a renovated home was by a single 27 white girl who lived two houses away from ours. She did a lot of updating in two years but not a complete overhaul and sold her home in August for $184.50 per sq/ft. Use that number with our homes' 620 sq ft and you have a comp for $114,500. We feel very comfortable with our pricing and anaylyzed before, during, and even after the renovations and have kept our numbers at $99,000 the entire time. If a single professional were to buy the home with a conventional loan their payment would only be in the mid to high $500's/mo. If you're not living in rundown college apartments you know that's not an expensive cost of housing for any recent grad or employeed person at any stage.

If you have any more questions or comments cool. If you want to come by and look at the two homes, send me a pm.

NCJockGirl, 5 acres of privacy sound awesome... good luck

11/10/2008 10:55:47 PM

Quote :

"Ghetto - completely relative. Take a drive down that way at anytime and come back and write up here it's ghetto. If the average black person happens to walk by you while you're looking at them please keep in mind you probably voted for Obama and think its great this country can elect a black man, yet you still check to see if your locks are down. Really... great. Anyways, if you do take the time to drive around down there you'll find the majority of homes up to that block have been/or are getting renovated."

the Ghetto isn't classified by the color of a persons skin that lives there. Bars on the window, the appearance of said people (not their anatomical appearances btw), graffiti, etc....

11/11/2008 5:49:33 PM

fore everyones information

partner

and

business partner

have two different definitions these days

11/11/2008 6:58:32 PM

^does it really mater?

11/11/2008 7:39:37 PM

how much did you pay for it? $10K?

11/11/2008 7:53:20 PM

so you watched an episode of flip that house too?

11/11/2008 8:14:35 PM

That's a neighborhood that I would drive to when I wanted to smoke weed in my car and not be bothered. It's the ghetto. Has nothing to do with color and I did not vote.

This is not to say that this neighborhood will not be very much worth it in the next 3 to 5 years. The price on the house may be a touch on the high side but given Raleigh's recent expansion and population growth I would suggest holding on to the property as long as possible before selling. Rent this shit out for 2 years and then sell it once the market bounces back and the neighborhood is on the rise.

[Edited on November 11, 2008 at 8:26 PM. Reason : ]

11/11/2008 8:16:00 PM

I think the problem is finding somebody to rent it for 2 years.

11/11/2008 8:47:37 PM

Its value is less than $30K.
http://services.wakegov.com/realestate/Account.asp?id=0006041&stype=addr&stnum=125&stname=Camden&locidList=&spg=1

Good luck.

11/11/2008 9:07:46 PM

I'm not saying it is or isn't worth $99k, but tax value is relatively useless when it comes to determining the true value of a house. The recent comps are what really matter.

11/11/2008 9:20:26 PM

id say tax value is one of the biggest factors in the market today...thats just my 2 cents and my family moves quite a bit of real estate in the east.

11/11/2008 9:30:19 PM

^^^why doesn't it show how much the house was bought for?

Also, didn't the tax value just got re-assessed last year? so I would think it would be more accurate now as far as reflecting the market value.

[Edited on November 11, 2008 at 9:33 PM. Reason : .]

11/11/2008 9:32:02 PM

Aha, one of your names is Matthew Fuchs. Was probably picked up due to the previous owner not paying their taxes.

11/11/2008 9:39:36 PM

^yep, you're right. Probably one of those "tax-lien" deal.

11/11/2008 9:41:03 PM

Quote :

"Loan: 10% APR 30 yr Amm"

now thats what the fuck im talking about...... a true money making plan.
gives me an idea

gg

Quote :

"Fact of life. As I said we're willing to take the risk on of having someone carry the note with us"

people that dont realize that risk needs return will die broke

[Edited on November 11, 2008 at 9:44 PM. Reason : 1]

11/11/2008 9:42:52 PM

They got 3 houses in a row there. Knock all them bastards down and build something nice. You could build a 1500 square foot house.

11/11/2008 9:46:28 PM

they aren't worried about the risk of the loan because I bet they got the house for next to nothing anyway, so if the buyer can't pay after a while, they'll just take the house back, and whatever they've been paid is pure profit.

11/11/2008 9:47:22 PM

whoever didn't know that immediately should still be under the wing of mommy

[Edited on November 11, 2008 at 9:49 PM. Reason : commerce nigga]

11/11/2008 9:48:43 PM

Even if they did get the houses for next to nothing they have probably dumped at least $100k in fixing them all up. If they get the asking price on this house they will probably break even across the three lots they took. Everything else will be profit

11/11/2008 9:50:13 PM

Quote :

"they aren't worried about the risk of the loan because I bet they got the house for next to nothing anyway, so if the buyer can't pay after a while, they'll just take the house back, and whatever they've been paid is pure profit."

You guys might want to check on how much it costs to "take a house back". I can pretty much promise you there will not be much profit.

Unless of course you are going to maintain title to it in which case this is "rent to own".

11/11/2008 10:40:24 PM

Quote :

"Also, didn't the tax value just got re-assessed last year? so I would think it would be more accurate now as far as reflecting the market value."

You can talk about tax value all you want, but if the houses next door are selling for 2x to 3x tax value you're going to be shit out of luck when you try to buy in that area.

I can spend $100k renovating a kitchen and two bathrooms. Don't you think that the house with the $100k in the kitchen and bathrooms is worth more than the house with 50 year old cabinets that have been painted 8 times and a draft that can be felt whenever the wind blows? Tax value is almost useless. Even the banks know this. That's why they require you to get an appraisal on almost all new home purchases.

Yes, tax values were reassessed last year. That means nothing for "up-and-coming" areas. When I first moved to Raleigh in 1997 you could buy homes in 5 Points for $40k. A decade later you'd be lucky to find a 800 sq. ft. house there for less than $220k. Less than a decade ago you didn't want to drive through Mordecai, Oakwood, or Boylan Heights; but now they are some of the most valuable pieces of residential land in Raleigh. When the right people in Raleigh decide that a neighborhood is next to be cleaned up you either jump on the train or GTFO of the way. It's like the stock market. You can make a fortune by buying high and selling higher.

Not saying this is the case with these homes or this market, but the potential is there. If you let "tax value" influence you then you are so far behind that you might as well just give up.

11/12/2008 12:26:28 AM

I just finished reading an article on MSNBC about how realtors are having a hard time getting sellers to realize how low the value of thier homes are now that the market is so bad. Good luck with your $100,000 shoe box.

11/12/2008 8:46:59 AM

HAHAHA this thread is a joke

11/12/2008 9:52:32 AM

wtf is a california closet?

11/12/2008 11:23:09 AM

aren't you the one always crying "search google" when someone asks a question?

11/12/2008 1:23:08 PM

Quote :

"RENT TO OWN"

11/12/2008 1:28:39 PM

^^uhh no

11/12/2008 2:03:46 PM

Rent to own and owner financing are two completely different things. In most rent to own scenarios a renter will pay an inflated rent and the landlord will apply the additional payment towards an escrow account to help the potential buyer save up the necessary funds for a down payment. Owner financing occurs when a deed is transferred to the new owner and the seller retains a Promissory Note for the remainder of the balance. Someone commented that the foreclosure process is expensive, simply not true with the use of a Promissory Note. It's a mere matter of letters, filings at the court house, and a execution of bylaws laid out in the Promissory Note. Rather simple and quick process if spelled out correctly from the beginning. A prime example of this are "Buy Here Pay Here" car dealerships you see lining Capital Blvd or Hwy 70 in Garner. Many car dealers will buy a sedan for $3000 at auction, get $500 down, $500/mo for 10 months until the person defaults, take it back, clean it up, get another $500 down, $500/mo until the next person defaults.

*Not what we want to do by any means as we don't want to play bankers. However, we also know an idle investment is a bad investment and are thus "willing to take the risk" as said before.

Tax Value - keep in mind these were assessed prior to our renovations. You can find many examples in Oakwood, Boylan Heights, Five Points where people pay twice or more then the tax value due to the renovations that have taken place after an assessment year.

Flip this house - used to watch it and still do from time to time. Not a bad place for ideas or quick tips and if you think it's as easy as watching a show and then playing contractor you're sorely mistaken.

California Closets - Brand name for a company that makes well organized closest shelving systems. These houses, like most that claim to have California Closets, do not actually have closest manufactured by the company; however, they have done such a good job in marketing that the term has become synomous with a "custom closet". Ours have built in shelves, two dress shirt length sections, a longer 'dress' section and shelves above the entire thing made out of MDF not wire racks.

Shoe Box - yep, it is 14*43 (plus a little bump) but who ever buys it will live in it for a few years and can easily keep it as a rental and at a minimum break even and hold it for a while longer as this area is quickly turning and becoming a desireable/affordable neighborhood within walking distance of downtown.

Lastly, I'm pretty sure there's a real estate thread in the Lounge for anyone who wants to continue displaying their obvious lack of knowledge on the subject. To the few of you who have made thoughtful posts, gg

11/12/2008 2:28:16 PM

k, so what is the actual appraised value? Meaning if in two years the buyer is to refi the remainder owed to you, will they even be able to get a loan owing ~$92,000?

11/12/2008 3:18:26 PM

sd2nc - Yes, the homes should appraise easily for the $99k asking price. If you didn't see it posted earlier a home on the same block (801 Cotton Pl if you wanted to look it up) sold for $184.50 sq/ft at the heigth of the Fannie/Freddie Mac Panic in August that being considered these homes should appraise in the $115k range.

From an investment property standpoint with an expected rent of $650/mo these properties carry an 8 CAP value of $97,500. With most bank now requiring 20% down on investment properties the projected monthly cash flow from one would be: $180/mo per home which more then covers taxes/insurance. And yes, if an investor wanted to purchase all three then one we would consider offers below the $99k asking price.

11/12/2008 3:37:51 PM

I'm assuming the roughly $9,000 the person is paying you in interest the first year, $8,900 the next, etc. is not tax deductible by the purchaser?

11/12/2008 3:54:23 PM

Whether you go the owner financing route or traditional mortgage the interest is able to be written off. So yes, with our 10% option the first year's interest of $9,376.48 can be a write off. Plus you can depreciate the value of a home over a 28 year period and take more deductions that way.

Owner Financing (the correct way that we are proposing) includes the transfering of a deed and the home would be yours, the write offs are yours, the maintenance is yours, taxes, insurance, etc. is all yours. If you decided to sell the home while financing through us any potential profit you make will be yours. The Promissory Note is the only thing we keep. If you don't pay we have the right to excerise the foreclosure and take the home back as collateral. No real difference then with a bank other then the higher finance charge due to us not being a bank.

If you have any interest in this home or another and have a serious question, I'd be happy to answer it as unlike many posts on here, I've done this, am doing this, and will continue to renovate houses in the future and have taken the time to learn the processes, windfalls, and pitfalls associated with it.

11/12/2008 4:04:16 PM

This is not a bad neighborhood, guys. It is the next up and coming area in Raleigh, and is literally a stone's throw away from a whole line of larger houses that are being renovated or have been already, one of which is owned by & lived in by Mayor Meeker's son.


If you were smart, which you're probably not if you're talking shit, you'd realize that 99k on this house now will turn into 200k in less than 5 years.


I happen to know the girl who sold hers (really well, in fact) in their neighborhood - I know what she bought her house for, I know what she invested in it, and I know what she got at sale.

[Edited on November 13, 2008 at 7:28 AM. Reason : it's a good neighborhood to invest in]

11/13/2008 7:24:47 AM

luker,

Can you please explain, in detail, the renovations and improvements that you made to these houses? Please include who did the work, for example, if you did the work let us know that. Also, do you warranty the work that you had done? This will help justify the large increase in price over the tax value.

Thanks,

DrunkTyper

11/13/2008 8:57:25 AM

haha, it's sandwiched between the projects and the homeless shelter

11/13/2008 9:03:21 AM

i live very close & wouldnt recommend

11/13/2008 11:11:14 AM

there are black people nearby!

11/13/2008 11:12:52 AM

^nah - lots of astronauts, fucking space walkin freaks

11/13/2008 11:14:47 AM

Quote :

"If you were smart, which you're probably not if you're talking shit, you'd realize that 99k on this house now will turn into 200k in less than 5 years."

Ok, while I don't think the shit lurker is taking is justified from some of these people (how many of you have purchased a home lately?), I think you're a bit out of your mind to think this property goes to 200k in five years. Heck, if you're so certain and smart, then why aren't you jumping at the opportunity to purchase it? Surely, if you don't have the capital yourself, you can corral a few buddies to go in and purchase this thing and just sit on it.

The property probably will eventually appreciate and be worth quite a bit more, but probably not in 5 years. Think of the ton of investment that has gone into downtown and close by with all the condo towers being built right at the peak of the housing bubble. Investment will effectively be stopped for a few years as they struggle to sell all those lavish condos. Supply and demand rules still apply.

11/13/2008 12:05:12 PM