OfflineAs the under $50,000 SFR's are getting snatched up by local heavy hitters and out of town investors here in Vegas it's getting harder and harder to get deep discounts, but I got another one-- almost! I got it at $53,200, but if the inspection warrants it, now that I am "at the dance" I may be able to go in and get an addendum for a lower price.
I put it out to my "more retail" rehabber first-- if they decline, I'll go to my "more retail" landlord and then to one of my heavy hitters, a buy n' hold guy doing high volume-- I have 7 days due diligence, so I'll let you know when it's "sold" and the "wholesale flip" is completed.
Specs & Details:
REO
4X2, 1234sf, built 1970
Listed in 2/3/11 at $76,900, reduced to $72,900 on March 3rd, reduced again 3/27 to $64,900.
My first offer on 3/22 (when asking was $72,900) of $48,800 was countered at asking (red to $64,900) on 3/28-- I increased a LOT as my Highest & Best to $53,200. I did this because the prop needs little work and I am getting "bid out" often in the last 3 weeks. The seller countered again at $59,900 (they dropped $5K) on 4/10-- I stayed at $53,200. On 4/13 they accepted.
The comp is $77,000, only a 31% spread, but enough for me to work with to flip this to the right buyer. Now I have 2 to "sell" this week.
I'll keep you posted. Thanks for stopping by.
-Tina
Never, Never, Never Quit, N3Q
"Nothing happens until you place an offer."
"Skip Deal #1, go straight to Deal #2; it's so much easier."
"There is nothing so useless as doing efficiently that which should not be done at all." — Peter F. Drucker... so, "Don't sweat the small stuff." -R.Carlson. "The greatest mistake you can make in life is to be continually fearing you will make one."~E.Hubbard, The Note Book, 1927...so, Do it for the right reason and "Do it with a headache!" - Dean Graziosi, Weekly Wisdom #176
Hey Mark, please forgive my tardiness! Holy cow, what a weekend! Please see below as I respond within your quote:
3.5) So I scratched my head enough to say, hmmmmmm, I wonder if I can just call the Recorder's Office, and I did. I explained what I was doing and she told me what was required, and which check box I should check for qualifying for an exemption of NV State Transfer Tax. All I needed was an Agent/Principal Agreement with my Buyer. My being an Agent )a hired hand) for my buyer allows this simple transaction to take place. Voila!
Thanks Tina! That explains a lot.
Q)So essentially what you're doing is acting as a purchasing agent on behalf of your buyer. I see. Pretty slick. A)- Yes. slick, yeah.
Q)You take all the money that's wired to you and wire it to the escrow account. Then you get paid at closing correct? A) Not necessarily. Some buyers will wire the purchase price, my fee and the closing costs, plus my reimb. for the earnest money. BAM! I wire out just the amount on the HUD for closing. So, before escrow closes, I get paid and reimbursed. In the other situation, a buyer will only wire the HUD 1 amount for closing, and I collect the reimb. of EMD and my fee when I hand over the keys.
Q)So you put the property under contract in your LLC's name and then the paperwork is drawn-up accordingly A) Yes. -Q)with you as a purchasing agent and then at closing everything goes to your buyer and your fee is wired into your account. A) No. I get funds from my buyer wired to me or they wire directly to escrow, and the property closes in my LLC. AFTER the deal is recorded (and per a side agreement with my buyer) I Quit Claim the property to my buyer (with an Agent Principal Agreement that allows us to be exempt from any transfer tax.
Q)Does the agent/principal agreement specify your fee in this transaction? A) No. It is purely to avoid (or rather be exempt) transfer tax, and as such it does not show any compensation.
Q)Another question, is it necessary to have a business entity (LLC in your case) to perform this kind of transaction? A) No. You could do it in your name.
(Okay, found answers to some of my own questions here: http://www.ruf.rice.edu/~schuler/principal-agent.html)
Again, thanks Tina, you've been a wealth of info!
To my Tech Hero, you are very welcome-- now, let's go get a deal. You must know someone who want's a Las Vegas place -)
Never, Never, Never Quit, N3Q
"Nothing happens until you place an offer."
"Skip Deal #1, go straight to Deal #2; it's so much easier."
"There is nothing so useless as doing efficiently that which should not be done at all." — Peter F. Drucker... so, "Don't sweat the small stuff." -R.Carlson. "The greatest mistake you can make in life is to be continually fearing you will make one."~E.Hubbard, The Note Book, 1927...so, Do it for the right reason and "Do it with a headache!" - Dean Graziosi, Weekly Wisdom #176
The buyer wired the funds to my account including the purchase price, closing costs (per the HUD 1) AND the EMD reimbursement to me, plus my fee of $3,000 last Wed April 25-- we wired out the HUD 1 amount on Thursday (while I was in Scottsdale) and the deal closed!
Yahoo! N3Q is up $3,000.
- small but more than I had, so it's a good thing!
(I met so many people at EDGE that said my fees were too low, so I am working on it)
- Keep it coming
Thanks for reading,
Tina
Never, Never, Never Quit, N3Q
"Nothing happens until you place an offer."
"Skip Deal #1, go straight to Deal #2; it's so much easier."
"There is nothing so useless as doing efficiently that which should not be done at all." — Peter F. Drucker... so, "Don't sweat the small stuff." -R.Carlson. "The greatest mistake you can make in life is to be continually fearing you will make one."~E.Hubbard, The Note Book, 1927...so, Do it for the right reason and "Do it with a headache!" - Dean Graziosi, Weekly Wisdom #176
Don't worry about the tardiness, I knew you were at the EDGE and wasn't really expecting an all-out reply.
Thanks for the detailed answer.
Is there any reason why you couldn't use the Purchasing Agent form from the start and buy the deal for your buyer while using a JV agreement or bird-dog agreement in the background for your fee?
I'll keep my eyes open for LV deals!
Mark K.
Life Disclaimer: Past Failures are NOT indicative of Future Results.
Real Estate Glossary - Click Here for PDF
View My Everyday Blog - Click Here
Once I draft an A/P Agreement with a buyer, that agreement is good until one of us terminates it. So to answer you, yes. Regarding using a JV or side agreement ( I use a consultant, not a bird dog) agreement because I don't just pass a deal on, I close the deal and the buyer is better taken care of, but in any case...
I don't do that ahead because I "shop" so agressively that I want to be able to sell to any number of buyers; all offer are made in my LLC, THEN I match up with the best buyer.
Make sense?
-Tina
Thanks for the detailed answer.
Is there any reason why you couldn't use the Purchasing Agent form from the start and buy the deal for your buyer while using a JV agreement or bird-dog agreement in the background for your fee?
I'll keep my eyes open for LV deals!
Never, Never, Never Quit, N3Q
"Nothing happens until you place an offer."
"Skip Deal #1, go straight to Deal #2; it's so much easier."
"There is nothing so useless as doing efficiently that which should not be done at all." — Peter F. Drucker... so, "Don't sweat the small stuff." -R.Carlson. "The greatest mistake you can make in life is to be continually fearing you will make one."~E.Hubbard, The Note Book, 1927...so, Do it for the right reason and "Do it with a headache!" - Dean Graziosi, Weekly Wisdom #176
Make sense?
-Tina
Yes! 110%
Mark K.
Life Disclaimer: Past Failures are NOT indicative of Future Results.
Real Estate Glossary - Click Here for PDF
View My Everyday Blog - Click Here