Forum Replies Created
Adam,
Now that you are cashed up. Take your time to get it right. Write down your plan and describe exactly what you are looking for. Put it into a spreadsheet and know exactly what the rewards are given the price you pay.
If you are worried about future growth, look at the suburbs track record over last 20 years. How long did it take for median price to double? Working backwards from todays median price, when was it worth half as much? eg house today is worth 300K and 10 years ago it was 150K it took 10years to double in price or 7.2% (compounded) annual growth. Be conservative in your growth estimates and you may be surprised if a boom comes. You will be able to sleep at night by not being wild in your estimations.
Now is as good a time as any to start. I am in the process of settling (in next 2 weeks) on 2 properties that I bought below market ( up to 40% below Assessed Value) that have a cash on cash return better than 10% and are showing 40%+ annual returns with equity growth and cash. Time invested to find them? A few months to locate the area, and about 100 hours of research on the ground.
The key is sticking to your guns, and listening to your head and your spreadsheet. If you are lucky you will find an agent that will see you as long term investor and show you what you are looking for. If by the 3rd property they are off course give them 1 more chance after a warning. If they are not spot on, give them the flick and move on. They are wasting your time.
Good hunting. You don't need much luck as you have plan and a system.
Cheers.
C3
I would think you could nominate a person or entity as a landlord on the document. For example you could choose to have xyz R/Estate act as your agent (landloard) to manage the property.
Qlds007 wrote:There is a big difference between a wrap and a second mortgage carry back.I have been involved in each for over 13 years here in Qld.
They loan argreements between each type of contract vary considerably and your usual suburban Solicitor may not have a clue.
As Terry mentioned financing the deals these days as far as the incoming purchaser is concerned is not easy.
So what firms or people do you recommend or use in your business for these types of transactions? With 13 years of experience you must have a list of preferred, 'switched on' solicitors.
Please share.
Oh course banks don't like this… they loose out on being the bank.
It is all about cash flow…. I would it prefer it flow to me (as a return on my money/equity) than to the bank.I rang Conveyancing Works in Brisbane who recommended Tony at Eaton Lawyers in Arrana Hills for doing vendor finance contracts. He is very familiar with the process and will work with selling agents to ensure all parties are 'covered' legally and interests are secured against the property (rather than a simple contract).
When deals get down to how creative you can be to get your price or how to get the interest rate you can afford, then a blend of vendor finance works. The key is to make sure you are covered legally and have a good 'monitoring' system (escrow) in place to make sure the transaction(s) go off according to plan.
Tony emphasised that the purchaser must also list the vendor on any insurance policies until such time as the vendor has been completely paid out and vendor has released property lien to the purchaser. He said purchasers normally pay for the costs of a vendor contract agreement as they are the beneficiary of the agreement.
I can't speak to fee's for the service as I do not have anything to compare against. I have not gotten an email back yet with full schedule of fees from Eatons, however their std costs were within $50.00 of CW.
Time is money. For me I am happy to pay for legal advice, accounting advice, and in this case escrow services. $10-20 a month service fee for accepting and managing payments/documents is a small price to pay to get everything right, when you are talking tens of thousands of $$.
I've never used Eatons. Anyone have comments about them?
1. I do not want to manage the monthly accounts
2. I want the documents to be kept securely (where will I be in 6 years??) so they can be passed to purchaser upon completion of contract terms.
3. I want interest owing and paid calculated correctly and subtracted from the outstanding principle owing.
4. I want to provide the buyer with security to know that a neutral 3rd party is handling the funds each monthIn the simplest of terms. A buyer has contract with me pay me $xxx per month including interest at xx% on a Vendor contract for 5 years for $XXXX. Each month they pay to a nominated trust account their payment. They are secure in knowing they made a payment and I am secure in knowing the payment is recorded and credited. If they fail to pay I have neutral 3rd party to veriy they have not been making payments and are in breach of our contract. This literally can be used to foreclose on the property (subject to the first mortgage) if things go pear shaped.
Lots of benefits for all parties. Interest goes to me not to the bank (I like being a bank when I get paid interest), the buyer gets a lower overall rate, I get a higher price for my property, everyone is secure as a 3rd party handles $$.
Am I crazy?
This is what my Real Estate agent says to me….
……We have spoken to a solicitor about Escrow agreements, she said they no longer use them, because its really taking out a second mortgage, they are too complicated and very risky.
Does any body do wraps in Qld? His solicitor is a 'property specialist lawyer'.
Escrow means in held in trust.
Documents, real estate, money, or securities deposited with a neutral third party (the escrow agent) to be delivered upon fulfillment of certain conditions, as established in a written agreement.
Definition 2
An account held by the lender into which a homeowner pays money for reduction of the principle outstanding.In my case I am looking for an agent to manage the collection of payments, calculation of the interest owing, and the maintaining the documents until such time as the contract terms are fullfilled. They would pass collected funds on to me each month upon payment by the purchasers. Purchasers are assured their funds are properly being accounted for and credited against the debt.
My question to the forum is: Who in Brisbane have people used and could recommend?
