32-Unit Short Sale Apartment

One of our recent projects has been the negotiation of a 32-unit short sale multi-family aparment complex. Each deal we negotiate is unique but this one has been really interesting.

A few observations:

-The property did go to auction and the bank bought it back. This wiped away the 300K in construction liens on title.

-The bank is a small regional bank and got in way over it's head on the loan to the investor. The complex is only two years old and is 66% occupied at the moment. 

-All banks we've been talking to regarding financing will only loan based on 85% occupancy, 30% downpayment, and  a debt to income (DSCR) of 1.3 or more.

-It's been clear that the bank has no idea about commercial real estate valuation and is trying to sell the property based on inflated information. We buy only on acutal numbers, never on future performance!

-The bank was initially asking for 1.5 million and came down to 1.2 million. Our offer has remained firm at 750k because this a value in which we safely cover our expenses and debt service.

-Then bank is very motivated to sell because they must hold reserves against this property on their books. Banks are not in the business of owning real estate. They are in the business of lending money!

-The trick will be to find a way to do this deal with 100% financing and no money out of pocket. We believe that the bank is in a position where they must consider this.

Like a friend of mine said this weekend past, don't focus on just one deal, there are so many out there that if you are making offers on 10 properties at a time, one will eventually go your way.

We will keep you posted on the progress with this deal. 

Geoffrey & Gabe

OC Short Sale Guys

(949) 287-4483

OC Short Sale Guys - Cashflow Club

Greetings everyone,

I'm excited to announce our next CASHFLOW event which will be once again co-sponsored by the Newport Jaycees!

Because of the success of our last CASHFLOW game with the Jaycees, they asked us to host another game night and teach the game to their members.

We'll be meeting in the clubhouse at Park Newport Apartments, located just off of Jamboree and San Joaquin Hills Rd., across from Fashion Island in Newport Beach.

Time and Place

Date:	Wednesday, November 12, 2008
Time:	7:00pm - 10:00pm
Location:	Park Newport Apartments at the Clubhouse
Street:	1 Park Newport
City/Town:	Newport Beach, CA

Come and join us. And feel free to bring a friend. It's going to be a fun time and a different format.

We'll be going over real ways to make money through investing in these economic times. Learn how to respond to what is happening all around us on a daily basis and take advantage of the opportunities! All while having fun!

Come out out and join us again. Or join us for the first time. We look forward to seeing you there.

Geoffrey & Gabe
OC Short Sale Guys

Call to RSVP (949)287-4483   

What we do

Greetings everyone!

This is the first posting for our new blog. We're really excited about growing our business and informing everyone on what we're doing out in the real estate market.

Since now IS the time to invest in real estate, we have been purusing a few different types of investment strategies. We have been involved in multi-family, short sales, foreclosures, and re-hab properties.

Primarily we focus on short sales and are looking to work with real estate agents.

Here is a basic explanation of what we do.

OC Short Sale Guys works with 3 parties: the seller, the bank and the real estate agent.

We negotiate the short sale price directly with the bank and purchase the property with cash from the seller. After we close with theseller OC Short Sale Guys is the new owner.We then turn around and list the property with the real estate agent who brought us the deal. (There are contracts signed, for the agents protection, that clearly state that the agent will receive the property as their listing. For any interested agents, I can send you a copy of the contract that we use so you may review it.)

We have successfully completed 100+ transactions and are looking at creating a win-win situations…

The seller is happy because they can get out of their property andavoid a foreclosure.

The agent is happy because they are now listing a sellableproperty with $20k - $50k in equity.

Short sales can be difficult to have on the books, especially in today's market, so we act to take the short sale off the agents plate and turn around and to give them a property that you can be sold quickly and easily.

I hope this provides a clearer explanation.

Will post again soon,

Geoffrey & Gabe
OC Short Sale Guys

(949) 287-4483