[ocrenter]

[quote=jpinpb][quote=flu]Dude what is the fascination of what people do for a living? So the $200k loss on the home for the chiro… What’s that, 6 months of salary? :)[/quote]

Attention Piggs: flu now available to work for free for 6 months, not a problem ;)[/quote]

actually this is a good case study showing professionals and upper middle class folks really have the most to lose when it comes to RE purchase mistakes.

Today if the flipper was a typical renter class buyer that took adventage of loose lending standards, used a typical zero down, 80/20 loan commonly available back in the days, he/she would have walked away with no losses at all. They came into the transaction with nothing, and they leave with nothing. Actually they probably leave with couple of years of free rent and the opportunity to live in a house they would have never had an opportunity to live in before.

But as a responsible upper middle class professional, straight up non-payment and foreclosure was not an obvious choice. And so you end up with a upstanding professional losing over $400k over 3 years.

That’s at least a couple of years of income especially since chiros do get hit hard when the economy goes down. (they are more of the non-essential medical services).

If this guy is young, he likely invested all of his savings. And will not be able to afford a house for some time to come. We are talking a life changing experience here. This is a huge game changer for him.

This is why this example is so important for all of us here. As a lot of Piggs can probably relate to this guy. Because frankly he is one of us, but somebody gave him the wrong advice and he wasn’t fortunate enough to stumble on this website and others like it.

[ocrenter]

[quote=jpinpb][quote=flu]Dude what is the fascination of what people do for a living? So the $200k loss on the home for the chiro… What’s that, 6 months of salary? :)[/quote]

Attention Piggs: flu now available to work for free for 6 months, not a problem ;)[/quote]

actually this is a good case study showing professionals and upper middle class folks really have the most to lose when it comes to RE purchase mistakes.

Today if the flipper was a typical renter class buyer that took adventage of loose lending standards, used a typical zero down, 80/20 loan commonly available back in the days, he/she would have walked away with no losses at all. They came into the transaction with nothing, and they leave with nothing. Actually they probably leave with couple of years of free rent and the opportunity to live in a house they would have never had an opportunity to live in before.

But as a responsible upper middle class professional, straight up non-payment and foreclosure was not an obvious choice. And so you end up with a upstanding professional losing over $400k over 3 years.

That’s at least a couple of years of income especially since chiros do get hit hard when the economy goes down. (they are more of the non-essential medical services).

If this guy is young, he likely invested all of his savings. And will not be able to afford a house for some time to come. We are talking a life changing experience here. This is a huge game changer for him.

This is why this example is so important for all of us here. As a lot of Piggs can probably relate to this guy. Because frankly he is one of us, but somebody gave him the wrong advice and he wasn’t fortunate enough to stumble on this website and others like it.

[ocrenter]

[quote=outtamojo]”SAN MARCOS: San Marcos High students to move off campus Rebuilding campus will take two years”.

http://m.nctimes.com/news/local/san-marcos/article_5c52cc00-37fc-5479-9214-e790bf0736ca.html

Take THAT Cbad and Lcc- a shiny new campus AND surging test scores : )[/quote]

that’s the power of SEH mello roos!

[ocrenter]

[quote=outtamojo]”SAN MARCOS: San Marcos High students to move off campus Rebuilding campus will take two years”.

http://m.nctimes.com/news/local/san-marcos/article_5c52cc00-37fc-5479-9214-e790bf0736ca.html

Take THAT Cbad and Lcc- a shiny new campus AND surging test scores : )[/quote]

that’s the power of SEH mello roos!

[ocrenter]

[quote=outtamojo]”SAN MARCOS: San Marcos High students to move off campus Rebuilding campus will take two years”.

http://m.nctimes.com/news/local/san-marcos/article_5c52cc00-37fc-5479-9214-e790bf0736ca.html

Take THAT Cbad and Lcc- a shiny new campus AND surging test scores : )[/quote]

that’s the power of SEH mello roos!

[ocrenter]

[quote=outtamojo]”SAN MARCOS: San Marcos High students to move off campus Rebuilding campus will take two years”.

http://m.nctimes.com/news/local/san-marcos/article_5c52cc00-37fc-5479-9214-e790bf0736ca.html

Take THAT Cbad and Lcc- a shiny new campus AND surging test scores : )[/quote]

that’s the power of SEH mello roos!

[ocrenter]

[quote=outtamojo]”SAN MARCOS: San Marcos High students to move off campus Rebuilding campus will take two years”.

http://m.nctimes.com/news/local/san-marcos/article_5c52cc00-37fc-5479-9214-e790bf0736ca.html

Take THAT Cbad and Lcc- a shiny new campus AND surging test scores : )[/quote]

that’s the power of SEH mello roos!

[ocrenter]

[quote=enron_by_the_sea]In 3 years he might have also paid about ~30K of principal assuming ~7% interest rate. (OTOH He might have gone IO route and paid nothing or he might have had a lower interest rate and paid more down towards principal)[/quote]

yup, totally forgot the most important carrying cost. I have to assume 5% interest since his first was full jumbo. Which means $5200/month in principal and interest. That’s roughly $187k.

with the $220k from my prior post, we are looking at $407k loss for the whole affair.

of course, a third of it should be tax deductible. so probably just around $270k in real losses.

[ocrenter]

[quote=enron_by_the_sea]In 3 years he might have also paid about ~30K of principal assuming ~7% interest rate. (OTOH He might have gone IO route and paid nothing or he might have had a lower interest rate and paid more down towards principal)[/quote]

yup, totally forgot the most important carrying cost. I have to assume 5% interest since his first was full jumbo. Which means $5200/month in principal and interest. That’s roughly $187k.

with the $220k from my prior post, we are looking at $407k loss for the whole affair.

of course, a third of it should be tax deductible. so probably just around $270k in real losses.

[ocrenter]

[quote=enron_by_the_sea]In 3 years he might have also paid about ~30K of principal assuming ~7% interest rate. (OTOH He might have gone IO route and paid nothing or he might have had a lower interest rate and paid more down towards principal)[/quote]

yup, totally forgot the most important carrying cost. I have to assume 5% interest since his first was full jumbo. Which means $5200/month in principal and interest. That’s roughly $187k.

with the $220k from my prior post, we are looking at $407k loss for the whole affair.

of course, a third of it should be tax deductible. so probably just around $270k in real losses.

[ocrenter]

[quote=enron_by_the_sea]In 3 years he might have also paid about ~30K of principal assuming ~7% interest rate. (OTOH He might have gone IO route and paid nothing or he might have had a lower interest rate and paid more down towards principal)[/quote]

yup, totally forgot the most important carrying cost. I have to assume 5% interest since his first was full jumbo. Which means $5200/month in principal and interest. That’s roughly $187k.

with the $220k from my prior post, we are looking at $407k loss for the whole affair.

of course, a third of it should be tax deductible. so probably just around $270k in real losses.

[ocrenter]

[quote=enron_by_the_sea]In 3 years he might have also paid about ~30K of principal assuming ~7% interest rate. (OTOH He might have gone IO route and paid nothing or he might have had a lower interest rate and paid more down towards principal)[/quote]

yup, totally forgot the most important carrying cost. I have to assume 5% interest since his first was full jumbo. Which means $5200/month in principal and interest. That’s roughly $187k.

with the $220k from my prior post, we are looking at $407k loss for the whole affair.

of course, a third of it should be tax deductible. so probably just around $270k in real losses.

[ocrenter]

purchase price was $1.08 million.

he had 10% down, followed by two loans with Indymac, the first is a $864,000 Jumbo and the second at $108,000 as an equity line of credit.

With the $850k sale price, after commission price would be $799k. So the second completely lost out and the first position lost $65k.

The Chiro lost his $108k down. probably $50k on the landscaping. $50k on property tax over the last 3 years. $5400 on hoa for 3 yrs. $4000 on utility for 3 yrs. $1000 on gardener for 3 yrs. Total of about $220k from this endeavor.

[ocrenter]

purchase price was $1.08 million.

he had 10% down, followed by two loans with Indymac, the first is a $864,000 Jumbo and the second at $108,000 as an equity line of credit.

With the $850k sale price, after commission price would be $799k. So the second completely lost out and the first position lost $65k.

The Chiro lost his $108k down. probably $50k on the landscaping. $50k on property tax over the last 3 years. $5400 on hoa for 3 yrs. $4000 on utility for 3 yrs. $1000 on gardener for 3 yrs. Total of about $220k from this endeavor.

[ocrenter]

purchase price was $1.08 million.

he had 10% down, followed by two loans with Indymac, the first is a $864,000 Jumbo and the second at $108,000 as an equity line of credit.

With the $850k sale price, after commission price would be $799k. So the second completely lost out and the first position lost $65k.

The Chiro lost his $108k down. probably $50k on the landscaping. $50k on property tax over the last 3 years. $5400 on hoa for 3 yrs. $4000 on utility for 3 yrs. $1000 on gardener for 3 yrs. Total of about $220k from this endeavor.

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