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October 27, 2010 at 11:08 AM #624302October 28, 2010 at 7:34 AM #623541evolusdParticipant
Update:
My title rep friend printed out all open Trust Deeds against the property. My intuition seemed to be correct about thier purchase in 2006:
1st – 80% purchase money 10Y interest only, 5/1 ARM starts adjusting next year and goes to P&I in 2016.
2nd – 10% home equity credit line
3rd – 10% personal loan (Bene of TD is individual)
Then in 2007, they refinanced the 3rd with another home equity credit line to payoff the individual and cash out $83k.
Bottom line (assuming they didn’t inherit/win a large sum of cash or paydown significantly from cash flow), they owe over $600k on a home worth about $400k.
Now I’m trying to figure out how to approach them with this issue. They may just give me the finger and move on to a less involved tenant.
I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.
Interesting time we live in, that’s for sure.
October 28, 2010 at 7:34 AM #623625evolusdParticipantUpdate:
My title rep friend printed out all open Trust Deeds against the property. My intuition seemed to be correct about thier purchase in 2006:
1st – 80% purchase money 10Y interest only, 5/1 ARM starts adjusting next year and goes to P&I in 2016.
2nd – 10% home equity credit line
3rd – 10% personal loan (Bene of TD is individual)
Then in 2007, they refinanced the 3rd with another home equity credit line to payoff the individual and cash out $83k.
Bottom line (assuming they didn’t inherit/win a large sum of cash or paydown significantly from cash flow), they owe over $600k on a home worth about $400k.
Now I’m trying to figure out how to approach them with this issue. They may just give me the finger and move on to a less involved tenant.
I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.
Interesting time we live in, that’s for sure.
October 28, 2010 at 7:34 AM #624188evolusdParticipantUpdate:
My title rep friend printed out all open Trust Deeds against the property. My intuition seemed to be correct about thier purchase in 2006:
1st – 80% purchase money 10Y interest only, 5/1 ARM starts adjusting next year and goes to P&I in 2016.
2nd – 10% home equity credit line
3rd – 10% personal loan (Bene of TD is individual)
Then in 2007, they refinanced the 3rd with another home equity credit line to payoff the individual and cash out $83k.
Bottom line (assuming they didn’t inherit/win a large sum of cash or paydown significantly from cash flow), they owe over $600k on a home worth about $400k.
Now I’m trying to figure out how to approach them with this issue. They may just give me the finger and move on to a less involved tenant.
I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.
Interesting time we live in, that’s for sure.
October 28, 2010 at 7:34 AM #624315evolusdParticipantUpdate:
My title rep friend printed out all open Trust Deeds against the property. My intuition seemed to be correct about thier purchase in 2006:
1st – 80% purchase money 10Y interest only, 5/1 ARM starts adjusting next year and goes to P&I in 2016.
2nd – 10% home equity credit line
3rd – 10% personal loan (Bene of TD is individual)
Then in 2007, they refinanced the 3rd with another home equity credit line to payoff the individual and cash out $83k.
Bottom line (assuming they didn’t inherit/win a large sum of cash or paydown significantly from cash flow), they owe over $600k on a home worth about $400k.
Now I’m trying to figure out how to approach them with this issue. They may just give me the finger and move on to a less involved tenant.
I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.
Interesting time we live in, that’s for sure.
October 28, 2010 at 7:34 AM #624631evolusdParticipantUpdate:
My title rep friend printed out all open Trust Deeds against the property. My intuition seemed to be correct about thier purchase in 2006:
1st – 80% purchase money 10Y interest only, 5/1 ARM starts adjusting next year and goes to P&I in 2016.
2nd – 10% home equity credit line
3rd – 10% personal loan (Bene of TD is individual)
Then in 2007, they refinanced the 3rd with another home equity credit line to payoff the individual and cash out $83k.
Bottom line (assuming they didn’t inherit/win a large sum of cash or paydown significantly from cash flow), they owe over $600k on a home worth about $400k.
Now I’m trying to figure out how to approach them with this issue. They may just give me the finger and move on to a less involved tenant.
I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.
Interesting time we live in, that’s for sure.
October 28, 2010 at 8:17 AM #623576temeculaguyParticipantgood work, evol. I suggest you just move on, screw it. I was going to comment before that I didn’t like the numbers even if they only owed 400k, at that rent, 350k debt is about break even. Personally anything more than 125x rent is a money loser so they need be the type of landlords who can weather the storm, not someone trying to avoid paying the piper for failed jr. trump behavior.
It sounds like they are rookie landlords, it wont take long before they realize that 2300 coming in and 4k going out doesn’t work. More than likely they are using you to qual for their new place then you’ll pay them for the year they don’t pay the bank.
October 28, 2010 at 8:17 AM #623660temeculaguyParticipantgood work, evol. I suggest you just move on, screw it. I was going to comment before that I didn’t like the numbers even if they only owed 400k, at that rent, 350k debt is about break even. Personally anything more than 125x rent is a money loser so they need be the type of landlords who can weather the storm, not someone trying to avoid paying the piper for failed jr. trump behavior.
It sounds like they are rookie landlords, it wont take long before they realize that 2300 coming in and 4k going out doesn’t work. More than likely they are using you to qual for their new place then you’ll pay them for the year they don’t pay the bank.
October 28, 2010 at 8:17 AM #624223temeculaguyParticipantgood work, evol. I suggest you just move on, screw it. I was going to comment before that I didn’t like the numbers even if they only owed 400k, at that rent, 350k debt is about break even. Personally anything more than 125x rent is a money loser so they need be the type of landlords who can weather the storm, not someone trying to avoid paying the piper for failed jr. trump behavior.
It sounds like they are rookie landlords, it wont take long before they realize that 2300 coming in and 4k going out doesn’t work. More than likely they are using you to qual for their new place then you’ll pay them for the year they don’t pay the bank.
October 28, 2010 at 8:17 AM #624350temeculaguyParticipantgood work, evol. I suggest you just move on, screw it. I was going to comment before that I didn’t like the numbers even if they only owed 400k, at that rent, 350k debt is about break even. Personally anything more than 125x rent is a money loser so they need be the type of landlords who can weather the storm, not someone trying to avoid paying the piper for failed jr. trump behavior.
It sounds like they are rookie landlords, it wont take long before they realize that 2300 coming in and 4k going out doesn’t work. More than likely they are using you to qual for their new place then you’ll pay them for the year they don’t pay the bank.
October 28, 2010 at 8:17 AM #624666temeculaguyParticipantgood work, evol. I suggest you just move on, screw it. I was going to comment before that I didn’t like the numbers even if they only owed 400k, at that rent, 350k debt is about break even. Personally anything more than 125x rent is a money loser so they need be the type of landlords who can weather the storm, not someone trying to avoid paying the piper for failed jr. trump behavior.
It sounds like they are rookie landlords, it wont take long before they realize that 2300 coming in and 4k going out doesn’t work. More than likely they are using you to qual for their new place then you’ll pay them for the year they don’t pay the bank.
October 28, 2010 at 8:35 AM #623581burghManParticipant[quote=evolusd]I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.[/quote]
You may want to consider the practical value of this approach.
The #1 rule of contract disputes: He who has the cash has a huge advantage.
Having the money in your bank account is worth much more than having the law on your side.
I agree with TG. Too risky.
October 28, 2010 at 8:35 AM #623665burghManParticipant[quote=evolusd]I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.[/quote]
You may want to consider the practical value of this approach.
The #1 rule of contract disputes: He who has the cash has a huge advantage.
Having the money in your bank account is worth much more than having the law on your side.
I agree with TG. Too risky.
October 28, 2010 at 8:35 AM #624228burghManParticipant[quote=evolusd]I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.[/quote]
You may want to consider the practical value of this approach.
The #1 rule of contract disputes: He who has the cash has a huge advantage.
Having the money in your bank account is worth much more than having the law on your side.
I agree with TG. Too risky.
October 28, 2010 at 8:35 AM #624355burghManParticipant[quote=evolusd]I’m thinking of adding a clause to the lease requiring notice should a default on any mortgage related to the property occur. If so, they have to return my deposit. I think I can even record some kind of document requiring the lenders to provide me notice of a default.[/quote]
You may want to consider the practical value of this approach.
The #1 rule of contract disputes: He who has the cash has a huge advantage.
Having the money in your bank account is worth much more than having the law on your side.
I agree with TG. Too risky.
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