I got two calls from investors who live in CA who bought properties here.
They were each referred by a real estate agent.( not the same one)
One of these guys has been making $2700 a month payments on a house since last August. He can’t sell it.
The other has been making $1800 a month payments since September. He can’t sell it.
Here’s an example of one of the deals:
Bought the house for $270,000 – it’s worth $360,000 He spent $20,000 fixing it up.
A nice $50,000 profit you would think – right?
He refinanced ( like many in CA investors do) and pulled out the equity. He was able to get a loan for $359,000. So payments are now $2700 PI only
But since he’s been making payments since August, there’s not much left of the “equity”
Now.. this CA guy is saying that he feels like he got scammed by the wholesaler who sold him the house.
It’s always someone else’s fault – right?
The other CA investor is in the same boat. What a mess!
Neither one of the CA investors has been to see the house since the day they bought it. They have not been involved in the marketing process at all.
It’s no wonder that the houses have not sold.
I also got a call from a local investor who bought 4 houses subject to and has section 8 tenants in the properties. He wants out. Just give him $1000 per house and they are mine. Problem is, the loans are ARM’s which adjust in a few months. And to make matters worse, The loan balance is actually MORE than the houses are worth.
You have to wonder where these guys are getting their education. If they learned to do business the right way, they could avoid these problems.
it’s better to do NO deals than to get into a BAD deal.
( Sure makes the mobile home business look attractive when you see these big – scary- numbers)