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Looking for help on my first EHT transaction

Home Forums General EHTrust/EHT Topics and Creative Real Estate Financing Looking for help on my first EHT transaction

This topic contains 7 replies, has 0 voices, and was last updated by Avatar of lwaldo lwaldo 8 years, 4 months ago.

Viewing 9 posts - 1 through 9 (of 9 total)
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  • #6806
    Avatar of lwaldo
    lwaldo
    Member

    I have an appointment to meet with a pre-foreclosure prospect this coming Monday morning.
    I would like to receive any tips and advise from those of you who have experience in the use of EHT’s in acquiring properties and can relate to my questions.
    I sent out letters to 106 NOD’s on July 21st and have received so far one response from an owner facing foreclosure who’s auction date is August 24th.
    The facts I know so far:
    The owner has vacated the property, it is vacant and in need of maintenance.
    He purchased the property 12/2006 for $225,000.
    His original 1st mortg $180,000 and original 2nd 45,000, probably from the same lender, although I don’t know yet who the lenders are, MERS is all I have so far.
    Balance due on 1st $182,100, default amount $39,000.
    Details of 2nd mort not available.
    Current Fair Market Value? I haven’t done my comps yet but my guess is $175,000.
    My plan:
    Interview owner and get as much info on loans as possible. What would he like to have happen?
    Get authorization forms signed by the owner so that I can deal with lender.
    Try to negotiate the default amount to the end of the loan.
    Convince the 2nd that there is no equity to cover the amount of the 2nd and should the auction sale occur they would end up withZero, so sell the 2nd to me for $500.00.
    Question; can I negotiate with the lenders without putting the property into a trust until later?
    This sounds like a good candidate for a H.O.P.E.S. solution, perhaps negotiating with the lenders should be a part of that process.
    If I pursue the H.O.P.E.S. approach can I proceed before finding the resident beneficiary?
    Because of the condition of the property (tall grass and weed and dirty windows) I would like to postpone showing the property to a prospective RB, but how do you handle the costs of clean up and staging?
    If fair market value is $175,000 isn’t a MAV of $227,000 (balance owing on loans) too much of a stretch?
    With move in cost of$39,000 (amount required to bring loan current) plus closing costs, the lists of potential RB’s would be very small. Would you get a prospective RB under contract with a smaller contribution and make it subject to getting the 2nd mortg eliminated?
    Any thoughts will be aprreciated.
    Lee

    #33860
    Avatar of corkhorner
    corkhorner
    Participant

    what city?
    Why not 3arck?

    Of course bk 13 will stall any sale for awhile.

    cork horner
    Mesa AZ
    San Diego, Ca.

    #33861
    Avatar of lwaldo
    lwaldo
    Member

    The property is in Woodburn, 30 miles south of Portland, Oregon.
    3 arck is a possibilty, however, I have heard that the investors willing to put up funds want to do that for Million dollar properties rather than 200,000 properties. I am still open to that possibility.
    My meeting with the owner was postponed by the owner so as of yet I don’t know whether he would want to reclaim the property or just get off the hook.
    As to a bk, why not just start proceedings against the bank and buy some time that way?
    By the way if there is someone in the willamette valley who would like to brainstorm this business with me – say HEY!

    #33862
    Avatar of lwaldo
    lwaldo
    Member

    Well Cork,
    I am underwhelmed by the response I received to my plea for help on my potential transaction.
    Out of 104 readers of my post you were the only one to respond. I thank you for your input.
    Have a cool day in Mesa.

    #33863
    Avatar of corkhorner
    corkhorner
    Participant

    If you want, email me your phone

    No-no Corker, if you’re going to help someone, help them here so the rest of us can learn.

    Bill

    #33864
    Avatar of scott_l._moyes
    scott_l._moyes
    Participant

    @lwaldo wrote:

    Well Cork,
    I am underwhelmed by the response I received to my plea for help on my potential transaction.

    You said…
    @lwaldo wrote:

    I would like to receive any tips and advise from those of you who have experience in the use of EHT’s in acquiring properties and can relate to my questions.

    From those who have “experience”. Unfortunately most of the “experienced” members don’t read or post here often or often enough. They are focused on their own transactions and are in it to share or assist other members.

    Most of those that follow the board are either looking for information and assistance themselves or are experienced in the reading about and telling others how it all works, but have very little if any “real experience” in actually completing a transaction, thus the reason for few replies.

    I was probably the first one to read your request but elected not to reply just yet. I wanted to see who would reply and what if any advice would come from our truly experienced members, not just the ones with a lot of book learn’in.

    You are also asking for some very specific advice, which may take some time to review with you.

    I personally have some serious concerns about your eagerness to “deal” with his lender or try to “negotiate” anything with them. In my experience and opinion, this is a total waste of time.

    Another thing, NARS has in place a program just for these kinds of situation called 3ARK. Although it is true that if the homeowner can’t or doesn’t want to pay the setup amount to 3ARK, that an Investor may. But, as you know, they typically don’t like to do this with properties of value below a certain value.

    With regard to HOPES. HOPES IS NOT a NARS Program or Product. It is nothing more than a name one our good members named his Equity Share or Shared Appreciation Mortgage Proposal to a lender using a NARS Equity Holding Trust arrangement. This is typically not something that other members are knowledgeable enough to speak about or advise you on. The member (Dave Salcido) does not frequent the discussion board. If you have questions regarding HOPES, you will want to contact him directly.

    Now, when it comes to the use of the PAC/EHTrust for transactions, then Me or Bill are your contacts. Although I frequent the board each day, most of my time, as well as Bills, is spent with members with submitted transactions from following the process outlined in your Success Kit. If you desire a more personal touch and assistance with specific transactions, you may want to consider the OCS Personal Mentoring Program, which I highly recommend. I’d be glad to discuss the details of OCS with your personally.

    I caution you to seriously consider who you ask for advise and/or choose to work with when it comes to anything related to NARS or the use of the EHTrust. Is your advise coming from someone actively using and CLOSING EHTrust Transactions, how many have they done and are they making any money in this business. Like I said, there are a lot of “book learned” members.

    If you need specific assistance, please call or email Me or Bill directly.

    FAIR ENOUGH?

    #33865
    Avatar of bill
    bill
    Participant

    Lee,

    I’ll jump in here.

    Firt off, you’re right about investor’s being hestatn on this size of prperty; however, we might find a couple folks that would put in $4K each or 4 of them for $2K each. Or perhaps the owner could put in half of the it…remeber they all get their money back whether we are successful or not.

    Another thing, if the guy is out of the prperty and doesn’t care about keeping it, he could rent it out during the year it would take to expunge the loan or hold the forclssoure open (assuming there’s b een no sale date thus far).

    As far as three Arck is concerned, remember that even if we were to fail (‘never have yet, however), there are months and months of free house payments to consider. And if we are unable to prevent final forclsoure, we will virtually always get monetary restitution instead due to the ultra vires, deceit, forgery and and predatory lending practices of the faux mortgagor.

    Get this package together (email me at bg@landtrust.net for the 80 pg 3Arck booklet…no charge, of course ) and I’ll put it out to our investor base.

    Bill

    #33866
    Avatar of corkhorner
    corkhorner
    Participant

    Bill, my approach to cre is based on not having all the answers—-about anything. That would include how to close ANY transaction for the ‘good of all’.

    Mr Scott, by all appearances employs only Pactrust and EHT. I don’t challenge his methods in any way. I am willing to suggest some fall thru the cracks as mine have done occasionally.

    I have 2 parallel schools of thought 1] How to lose a million dollars or more. 2] How to make a million dollars or more.

    A 3rd would be How to make a million dollars or more and then—-keep it.

    In Metro Phx, the real estate meltdown capital [my words] since being here 6 weeks I see the equivalent of many opportunities shrouded in many disguises. In my creating and establishing Phoenix based relationships I have only heard the horror stories of many. Developers, builders, speculators etc who basically lost all their assets and holdings for many reasons. On balance there MUST be those who knew how to leave the game in time with ALL their winnings—-as many builders do. They stash their assets waiting for the next cycle as it will surely arrive. When that will occur NOBODY knows.

    In the metro Phoenix market this a lot of cash deals churning cash deals.
    Not ‘creative’ just using the power inherent in cash. Then there are those driven by creative strategies for various reasons including cash not being always available. A ‘famous trainer’ on a training call recently said “diversity is God’s way of getting a person to know themself”….

    It might be conjectured that ‘creative real estate’ evolved from scarcity of assets including cash. I think so.

    Again, the famous trainer I am referring to stated in his seminars I attended in person and phone taught this scenario: Don’t let being a purist get in the way of closing real estate transactions. The purist approach refers to landtrusts and EHT, when at times all parties refuse to employ it. Again , that trainers name rhymed with Atten. You might buy a G to complete the puzzle.

    Same trainer: “there are many strategies to design and close deals. Use whatever works. With this caveat: landtrust and EHT is most likely the best strategy.

    You know this person ,Mr atten with a G. Ya liking it yet?

    Soooooo, my approach? Give em what may be the best process and real estate via landrust procedures that launch the elements of the NEHT. If the other party or parties don’t like it based on ignorance or fear [maybe both] I then hunt for the avenues all parties can agree to


    sorta sounds like the political football going on in Washington relating to debt and income at the government level. I believe identical.

    So, now then….Iwaldo. These are a smattering of my approaches/tools.
    This means use whatever will work that all parties can agree. That’s where creativity pays off at all levels. As Mr Bill stated there are several routes to this dilemma applying to your situation, if it is still on the table. It may be gone by now,

    MY only reason for an offline phone call was to find out where the bodies lay…..[the problems/challenges]….what’s good is there are about 2 million vacant homes nationwide with these issues.

    I believe change is constant and basically everyday.

    Over,

    cork horner
    ps
    Scott—-don’t downplay ‘book learning’, ok? I have some written by your mentor.

    #33867
    Avatar of billgatten
    billgatten
    Participant

    Cork,

    You’ve been sneaking the Smart Pills again, Cork…and it’s showing.

    Lee, Cork is absolutely right on the money here. Some people want certain feature, benefits and protections in a transaction that others may not.

    Here’s why I virtually always tout the EHT (and I’m the first to admit that I’m way to often short-sighted and too much of a purist…don’t do what I do, do what I teach). My mind says the follwing to me in every deal in look into:

    How can I structure this transaction so that…

      I don’t have to worry about liens and lawsuits by the other party that could land on “my” property becasue of something I have no control over?
      I don’t have to worry about the lender calling “my” seller-carried note due and payable becuase of the owner’ alienationof title?
      I don’t have to worry about the other party doing something clandestinely that could hurt me later on.
      I don’t have to worry about getting sued myself and having my real estate embroiled in the suit
      I don’t have to worry about my bargain purchase reducing the values of all the other houses on the street
      I don’t have to handle any management or maintenance on the property
      I don’t have to worry about arguments between me and the other party/ies in the transaction
      I don’t have to worry about needing to refund any moneys to anyone if the deal falls apart later
      I don’t have to worry about not being able to walk away anytime I want to
      I don’t have to worry about qualifying of a loan
      I don’t have to worry about my bad or missing credit
      I don’t have to worry about needing cash to own tons of self-managed real estate
      I don’t have to worry about the government clamping down on seller-assisted financing
      I don’t have to worry about negative cash flow (because I can sell tax benefits with thr EHT)
      I don’t have to worry about getting new insurance when I acquire a property
      I don’t have to worry about property tax increases when I aqcquire a property
      I don’t have to worry abut anyone seeing my name in the public record
      I don’t have to worry about my heirs needing to pay transfer taxes and inheritance taxes and capital gains when I kick the buciket
      I don’t have to worry about anyone having access to my “probable” monetary wherewithall
      I don’t have to worry about how I can increase my net rental property income by 3-400 percent via the sale of income layers
      I don’t have to worry about anyone “changing the rules” on me half way through, or at the end of, the transaction
      I don’t have to worry about being forced to go though Foreclosure and Quiet Title if my tenant buyer doesn’t pay

    So…having said all that, just pick out some of these features that you can live without and use something other than an EHT.

    And remember that the EHT is not “something else”: it’s just the best and most logical way to do “everything else.”

    Bill

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