Eviction Process?

Ok here is the situation, this is the second time in 3 month that the tenant check pounced which is really a headache when you count on that money being in your account to pay your own bills, almost pounced my own check but fortunately I found it by accident.. and I tried to contact the tenant the last couple of days by phone leaving notes on the door and no answer went by the house few times no answer but I hear the dog barking, so is there is anyway to solve this or should I just go ahead with the eviction process, and what is really involved in that I never had to go through it ?

Thanks

Comments(11)

  • finniganps12th July, 2008

    Follow the procedures in your state - typically 3 day notice to pay or quit - then evict.

  • 438connected13th July, 2008

    20% Down is not the problem. Are you saying you can loan with 20% Down?

  • cdnsi14th July, 2008

    Awesome information. I have perhaps been going about finding a lender all wrong. I am employed of course and I will definitely check into the smaller banks in my community for the loan amount I am seeking for a future rehab project.

    Thanks a million

  • cjmazur14th July, 2008

    Are you in CA? I have a hard money lender that will do 80%, 3-5 pts and 12-15 points. Contact me if interested.

  • 438connected14th July, 2008

    Thanks for the offer but I am not in CA, I do business in OH, NC when it comes to rehabbing.

  • ITBInvestor15th July, 2008

    You said you are investing full time "after tinkering around for years and making a lot of money." Do you have any money left? Or free and clear property? If so, contact a commercial lender. I have talked to several in the last few months and am starting to get a warmer reception to expanding my business than 8-10 months ago. I am in a little different space than you, and my financing approach is different... mine is long term, yours short term. The capital is out there, you need to pitch the commercial lenders or find a hard money lender.

  • cjmazur31st July, 2008

    the problem w/ blanket or cross collateralize loan, is the difficulty or planning for the ability to sell the assets individually.

  • damionwebb011st August, 2008

    All of the loans against the asset classes I listed above are NON-Recourse. They are not Margin or Collar Loans. See description below:

    Features of Stock Loan:
    Non-Callable
    Non-Recourse
    All interest accrues
    Dividends credited to reduce interest

    Benefits:
    Market Protection, Liquidity, Growth, Tax Savings

    Bullish Market:
    If, at the end of the loan term, the price of the underlying collateralized shares has increased over and above the loan balance, the borrower will choose to pay back the loan and recover his stock position at its appreciated value.

    Bearish Market:
    Client can walk away from the principal and accrued interest and keep the 80% reinvested proceeds.

    Risks:
    Client not able to access stock until the end of the loan term. Client may owe a small capital gains tax
    in the event of a walk-away.

    Worst Case Scenario:
    The client will always have the 80% plus whatever it grows to no matter what happens to the stock.

    Features of Public Bond Loan:
    Pretty much the same as Stock features with some slight differences. Some Bonds can even be bought from the Bond Owner.

    The reason I know this is because I am an authorized agent to the lender that structures the capital financing. Closing times are between 1 to 2 weeks, depending on the deal.

    A great number of investors are starting to use this as an alternative finacing method to raise capital for their projects because there are not credit and/or financial requirements. The asset itself is the only thing that is evaluated.[ Edited by damionwebb01 on Date 08/01/2008 ]

  • ITBInvestor1st August, 2008

    Good point cjmazur... the problem w/ blanket or cross collateralize loan, is the difficulty or planning for the ability to sell the assets individually. Perhaps I used the term "blanket" too loosely. The banks that I have done business with using this have held the D-T on an individual (SFH) property. So assets can come and go, as long as the overall numbers are met. Maybe "portfolio loan" is a better term?

  • damionwebb012nd August, 2008

    ITBInvestor,

    The collateral is ONLY on the stock or bond, it is not on the investments you purchased with the loan proceeds.

    Let’s take your scenario….

    Say 8 months ago you obtained a stock loan using 20,000 shares of Fannie Mae stock @ $25 per share for a total collateral amount of $500,000. They will only lend up to 80% LTV (of the collateral amount) so you get a check for $400,000 in which most investors reinvest the proceeds into other projects.

    You decided to get a 2yr term @ any where from 5 to 8% interest. At the end of the term, you have a choice of either repaying the loan to re-acquire your shares, or you can just walk away and your shares revert to the lender.

    In this situation, there are 2 ways it can go…

    Scenario 1:
    Say during the loan term the stock increased in value to $30 per share. Because you still hold you position, you still benefit from the increased value. At the end of the term, you decide to pay off the 80% ($400,000) that you borrowed; you get your 20,000 shares back at its current value of $600,000 because you NEVER SOLD them to begin with. You net the $100,000 of the increased share value minus interest paid on the loan plus whatever money you made off of the $400,000 you used to re-invest.

    Scenario 2:
    Say during the loan term the Fannie Mae stock decreased to $9 per share thus creating a margin scenario. Your 20,000 share of stock leveraged is now worth only $180,000. At the end of the loan term you logically decide that you are not going to repay $400,000 on devalued stock. You decide to exercise your option to walk away. Since it is a non-recourse loan, you’re off clean (minus any possible tax implications).

    So you get the benefit creating liquidity in your current portfolio(s) to make money in other investment projects, while keeping your position. Of coarse the lender wants to mitigate the risk on their end and they will do their due diligence on the stock that you will want to leverage and they have certain stock evaluation methods on determining the LTV, so there is a method to their madness.

    You can also package multiple stock portfolios into one loan in order to get to the desired liquidity level. The minimum loan amount is $100,000.

    Hope that answers your question… I can send out an informational package if anyone desires it.

  • ypochris2nd August, 2008

    No wonder so many lenders are going under...

    There is no credit hit from walking away?

    Chris

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