Jessica Sulliman

I would have to bet that it is much the same in LA as it is in Phoenix. It truly depends on the bank, the property, and the time on market. Consult your agent for advice regarding the specific property. It is a seller’s market with most REO properties (Real Estate Owned) when they are priced right……generally you need to stay as close to list as possible when the price is already below market. You typically1 cannot offer well below list, as most of the banks have gotten smart and are instructing the agents to price the homes to sell in 10 days or less! Most bank owned properties are in an entirely different league. There will more than likely be multiple offers on the aggressively priced properties, and it is possible that the home will end up selling for OVER list price. There are many investors in the market right now bidding sight unseen on properties as soon as they hit the market. It is not uncommon for an agent to have 10 offers on a good property by the end of the first day on market! This is not always the case, however, and will be property specific. The good news is that you could make an offer and know within a few days…..very different from short sales as the bank has already taken their hit and is ready to dissolve of their loss.

If you want to enter the bank owned game, expect to have competition, and to have to bid on multiple properties before you succeed. Good Luck! - Sat Sep 6 2008, 12:38

Does your client require a full doc or reduced doc loan? - Sat Sep 6 2008, 01:49

How do you get paid? Do you market at all in Arizona?? - Thu Aug 28 2008, 01:12

Hi Stephen....I am interested, however, I hesitate to make a 6 month financial committment to your site. You only have 2 other preferred agents for the entire state of Arizona......help me understand why I have to pay to become a preferred agent and what kind of leads you are getting for AZ on a regular basis? - Tue Jul 22 2008, 09:54

Hi Erin,

Lease options/lease purchases and/or renting to own is not the right scenario for everyone. You truly need to be committed to improving your credit and, after the analysis of a lender, it needs to be realistic that you will be able to actually repair your credit within a 12-24 month time period.

I work with a company that will have an investor purchase the home of your choice. You will essentially need to pay about $3750 upfront, and then you will also have to front the earnest deposit at time of contract. The earnest deposit is credited towards your future purchase. So, I would expect your total out of pocket expense to be around $5000-$6000.

There are benefits to doing a lease purchase/option, especially in this market. You don't have to worry about moving again, and you can treat your home like it is truly yours. It is also an advantage in a market like this, to lock in your price while the market is so ripe with great deals. We enjoy great success in helping families to gain home ownership and look forward to helping you get into a home which makes sense financially and meets your desires.

Let’s review your benefits. The goal is to create a win-win for you and an investor who will be the bank for you. The investor will use his good credit and pay the down payment and fees to purchase the home of your choice. Your investor will expect you to cover the monthly cost and will make a nominal return of 10% when you become financeable after working with a credit consultant. This fee can be completely offset through the negotiation process when we make an offer on your home. You may have heard this before: “You make money on a home when you buy it not when you sell it.”

The key to a successful transaction is negotiation. Good negotiation equals a good deal. This is why they provide a local buyers real estate agent (me) who is good at finding the right type of house. Discuss with me what type of home you want, what area you would like to live in, and what price fits within your budget. Work with me to negotiate the best price. Think of it this way: The better the deal the more money in your pocket (equity) when it is time to get the home refinanced in your name.

Here is an example of how we can create a win–win opportunity. Let’s assume you and I find a nice home worth $200,000 and the seller/bank is motivated to sell and open to negotiate. Most buyers are motivated as the market is a “buyer’s market” today. Great discounts can be found in the short sale and or bank owned properties today as there are an abundance of them.

$200,000 House value (based on an evaluation of recent closed comparable properties)
$-40,000 (20% discount)
$160,000 Purchase price
$ + 5,000 Closing cost/fees est.
$165,000 Investors purchase price
$ 16,500 Investor’s 10% gain
$181,500 Buyback price for you within 2 years
$-200,000 House value
$18,500 Your equity in the home

In this example you would have an equity position of $18,500 through the negotiation of the purchase price. In addition, the home should appreciate in value during the lease term.

Let’s say the home appreciates at a nominal rate of 5% a year:

$200,000 House value
X 5% Appreciation rate
$10,000 Equity in one year

In one year this would create a house value of $210,000 and your contract price of $181,500 gives you a total equity position of $28,500! If you had to go another year there could be even more equity available to you.

Buying a home can be an emotional decision but you also want to make it a wise financial decision. Our goal is to help you get into a home and make money doing so while we assist you in improving your credit. We want to help you find the right home that makes sense. We want to help you get back on your feet and into home ownership. We understand that you have some credit issues. We understand these credit issues are probably serious enough to have stopped you from pursuing your dreams of owning a home. Do not give up, but be very serious about your ability to pay for your new purchase. The purchase of a home should be based on your current income and not on income what may or may not be coming. We do not want to put you or our investors at risk. We want this to be a solid start for your new future.

As stated above, we understand you have credit issues. We will base our ability to help you on the belief we will be able to get the home financed in your name within a two year period. Contact me if you would like to learn more about the program. - Tue Aug 12 2008, 21:34

HI Tiffany,

That's awesome that you are thinking about securing a successful financial future beore you are even out of school! I wish I had done the same :-)

Where are you currently living? On campus? With your parents? Are you paying rent? As a college student, you more than likely have limited employment and credit history, so your loan/mortgage options will also be limited. Steve is right.....FHA will probably be your best bet to get started....and if yo go the FHA route, you may qualify for down payment and closing cost assistance and be able to hold onto your hard earned $10k. I would recommend holding onto as much of it as possible and keeping it as a safety net for making mortgage payments, property maintenance, etc. You'd be surprised how quickly that money will disappear. The best way to learn about how to buy and manage property is to start with your primary residence. If you live in the home for 2 out of the first 5 years, you won't have to pay capital gains tax on the profits when you do go to sell it. Have you thought about purchasing a home that you will live in, yet can rent rooms out to other college students to help offset the mortgage payment? In two years, you can move out and rent it out completely or move on to the next property! It takes time,money, and patience to become a seasoned real estate investor......I suggest baby steps and getting your feet wet with your first home to start. Of course, I'm available to chat further anytime....

Jessica
602-677-7977 - Tue Jul 22 2008, 11:04