MikeT/NC 5 Report post Posted April 6, 2014 Michael, After many false starts, back outs and hiccups, looks like I'm finally going to get a CA deal under contract. The guy called today and said he's ready to move forward. Got a couple of questions though. (1). When filling out the Option to purchase contract with the Seller, on line 3 the amount I put would be the $10 I'm paying the seller not the option/assignment fee I'm collecting from the buyer, right? (2) Are you still offering Rent Credits which I'm assuming would trigger Dodd-Frank compliance? Share this post Link to post Share on other sites
MichaelC 160 Report post Posted April 6, 2014 Mike, you are correct regarding the option consideration. You write in the amount you are paying the homeowner. The amount of option money the t/b pays is noted on the CA Assignment Agreement.I am working my CA deals to typically include a 50% rent credit. Share this post Link to post Share on other sites
pilot76180 51 Report post Posted April 10, 2014 We haven't offered a monthly rent credit for years. Our docs show a seller concession of say...$3600 That's it. It helps with finance and makes life simple. Also, FHA has a 6% cap on concessions. AS far as DF, I have yet to read anything in the bill that states that if you offer a rent credit you have to provide any sort of additional reportings etc. Although....DF is a moving target as the CBFP is creating rules on the fly to be in line with DF. DF...get 2 idiots to cause a problem then they think they solve it by creating more legislation. Share this post Link to post Share on other sites
MichaelC 160 Report post Posted April 10, 2014 Call it what you want. But at the end of the deal, if both parties want the deal to be done, it will be. Any half-witted attorney can play with the numbers and the paperwork to make the deal fly to everyone's satisfaction. Share this post Link to post Share on other sites
<Steve> 82 Report post Posted April 11, 2014 I love rent credits and would offer 50% up to 100%. It 's a great marketing tool. However, I will have to admit that I now offer a $dollar amount as a seller concession and call it a "Monthly Credit/Concession" when rents are paid timely. NC is probably the harshest state in the union when it comes to investors and creative deals. When the RE Commission & Attorney General latch on it can take a couple of years and an attorney to shake them off. They are looking, and would probably love to enforce dodd-frank with their interpretation including other state regulations. All it takes is a pissed t/b filing a complaint. No property is perfect, so I still offer a large concession as the seller conceds on the price when rents are paid on time because maybe the home needs updating, new carpet etc. Part of the concession can be used for closing cost per the lender's guid lines. So unfortunatety, I do not offer rents credits as a percentage to the purchase price. Principle pay down can be seen as financing. So far concessions seem to work just fine, but are not as cool as rent credits were. 1 Share this post Link to post Share on other sites
MichaelC 160 Report post Posted April 11, 2014 That's creative real estate, Steve. Do what you must to get the deal done and do it within the confines of whatever legislation needs to be worked around. 1 Share this post Link to post Share on other sites
