Why NOT to buy in the USA?

[lawsjs]

If not a default then a reset. I agree with you. BUT, there are still 230,000,000 tenants out there - and less than 10% of that figure is Australia.

I know more about the airports than most and I detest it. At least in BKK I would be happy to PAY the girls to frisk me again And again and .....

 

[topcropper]

Apart from that, the US is a basket case.

I disagree.

The US is the hub of innovation. It's certainly tough if you are poor and unskilled, but that's all the more incentive to make something of yourself. They will get themselves out of the hole they are in.

They have massive commodity wealth, but unfortunately for them, it is divided by 15 times as many people compared to Australia. The US supplies a lot of the world it's food, probably half the exportable surplus. Just the the state of Iowa produces twice the tonnes of corn as the whole of Australia grows wheat, and it's two thirds the size of Victoria. If the Middle-East were ever silly enough to denigh the US it's supply of oil, the US can starve them in retaliation.

The US is undergoing a slump. The US dollar is now back to where it should be. Now US exports will be competitive again, and they still have their manufacturing industries, unlike a lot of other places, including Australia. The US will be back.


Great stuff Perp.


See ya's.

 

[Monopoly]

they grope you at the airport, so I'd never see the place. No one touches the OA jewels except for the OA, and women of low moral calibre. No one.

Oh come on OA, if that's your only gripe, a bit of groping (at airports) you've hardly got a case to grizzle, I mean it takes but a few seconds and besides if you stand there long enough who knows, you may even enjoy it??!!

 

[lawsjs]

Last two times _ENTERING_ LAX 2+ hours to get out. Bradley terminal.

Leaving is where they frisk you - don't they understand you are leaving because you don't want to come back??

 

[Monopoly]

Oh but back to the topic of buying in the US. Why not?? So long as you do your homework, make sure you get expert advice from professional lawyers, lenders and accountants who are up-to-date with the do's and don'ts, then why not???

As a nation, I think (we) Australians are way way too conservative. I mean really, at the end of the day, if the worst you can lose is say $20-30K on one bad (what appeared to be a "too good to be true") deal, then consider it an expensive (although not devastating) mistake, but if it pans out well and indeed proves to be a positive cashflow investment with money back in your pocket, then you've done well.

I know I'm going to get hammered for this (but hey, it's Easter and if one guy can be raised from the dead, I reckon I can recover from this statement)

Those that are afraid to risk a small loss rarely achieve a big win.

 

[locko24]

Very interested in Perp's financing strategy of financing with no cash what-so-ever.

Presumably the bank finances 70-80% of the deal as usual, but the vendor finances the remainder of the amount - a second mortgage arrangement!?!

This sounds pretty risky for the vendor! What security does the vendor get? If the bank needs to foreclose, they will not be interested in selling the property for any more than what they are owed!

How do you convince a vendor to finance you?

Cheers

 

[Monopoly]

Very interested in Perp's financing strategy of financing with no cash what-so-ever.

Presumably the bank finances 70-80% of the deal as usual, but the vendor finances the remainder of the amount - a second mortgage arrangement!?!

This sounds pretty risky for the vendor! What security does the vendor get? If the bank needs to foreclose, they will not be interested in selling the property for any more than what they are owed!

How do you convince a vendor to finance you?

Cheers

I must admit I haven't read all of Perp's posts, so like you, would be interested to learn.

What "little" I do know of borrowing to buy in the USA is that lenders do require you to pay at least 18 months PITI (Principal, Interest, Taxes and Insurance). Lenders use PITI to calculate your monthly mortgage obligation and how much you can afford to borrow.

Maybe they cover themselves that way???

I'm still researching (and have a long way to go before I can fully understand it all) but I must say, it's fun!!!

 

[locko24]

One of Perps' posts claimed that loans over a certain value had little, if anything to do with what one earned.

I'm keen to learn as much as i can to find my best plan/s of attack before heading over

Doesn't seem the banks over there do too well at protecting themselves - they would do well to learn from Aus banks - 'How to rort the public'.
No sympathy from me though...

 

[Monopoly]

One of Perps' posts claimed that loans over a certain value had little, if anything to do with what one earned.

I'm keen to learn as much as i can to find my best plan/s of attack before heading over

Doesn't seem the banks over there do too well at protecting themselves - they would do well to learn from Aus banks - 'How to rort the public'.
No sympathy from me though...

Interesting you should say that because getting a loan over in the US is far more difficult that getting one here. In fact you have to produce all sorts of paperwork to your lenders with full disclosure of your credit history something that is a far cry from the information you need to provide lenders here!

If you're planning on buying with cash over there, you'll do well.
If you're going to rely on borrowing, be prepared for a sh*tload of paperwork and red tape. Even with their "community banks" which are made up of various individuals, there is still a lot of hoops you need to jump before they rubber stamp your loan application.

I've not purchased in the US, and that's not to say I will or won't (yet) but either way, I'll be doing my homework; just as you are doing now.

 

[Perp]

Very interested in Perp's financing strategy of financing with no cash what-so-ever.

Well, that's the goal, but I've found it very difficult to pull off.

Presumably the bank finances 70-80% of the deal as usual, but the vendor finances the remainder of the amount - a second mortgage arrangement!?!

That's possible, but not on the particular deal that I'm looking at right now. I'm pursuing several options for financing the current deal, and I don't know which will work out. I'm assuming I'll have to throw in at least $100K on this one, though.

This sounds pretty risky for the vendor! What security does the vendor get? If the bank needs to foreclose, they will not be interested in selling the property for any more than what they are owed!

How do you convince a vendor to finance you?

You usually use this strategy when the vendor's headed for foreclosure anyway, in which case the lender will sell for loan value (or less) anyway, so if the vendor takes a second, it's at least possible that they'll get something, whereas if they foreclose, they know they'll get nothing. Also, a foreclosure affects their credit and thus ability to move on, whereas if you take over before they go into foreclosure, they may be able to still buy something smaller.

This strategy can also be successful if the vendor's retiring and confident that you'll make a go of the venture; they're happy to have the income dribble in rather than get a lump sum.

In the USA, there's also a market which trades second mortgages ("paper"); they can sell their second mortgage for a smaller lump sum if they want cash now.

What "little" I do know of borrowing to buy in the USA is that lenders do require you to pay at least 18 months PITI (Principal, Interest, Taxes and Insurance). Lenders use PITI to calculate your monthly mortgage obligation and how much you can afford to borrow.

I haven't heard that specific obligation (ie 18 months up-front), but that definitely sounds like finance for a house or condominium, ie dependent on your own credit. I've elected to stay right out of that arena so can't comment.

One of Perps' posts claimed that loans over a certain value had little, if anything to do with what one earned.

It's more to do with the security of the income than the $ amount. So a $1M house purchase would still depend on your credit, but if it's to buy a block of units, it'd fall under commercial finance and be more reliant on the profit/equity in the deal.

Interesting you should say that because getting a loan over in the US is far more difficult that getting one here.

For a home or unit with conventional money, yes.

Getting commercial finance is another ball game.

Getting "hard money" is another level again. If you've identified a potential "flip" or turnaround opportunity, hard money is worth looking at. It's basically short-term commercial finance, secured against the asset, at a reasonably high interest rate, but it's easier to get. It can be a great short-term option to build up an income record (from the rent) which will allow you to refinance into a conventional mortgage in a year or two.

 

[Amadio]

Rix,
My vehement feelings on that ripoff market were deleted because (apparently) they were 'libellous'.

Keithj seemed to think (in my opinion somewhat erroneously) that out and out rip off spruikers deserve the full protection of some imaginary law. I actually ran my comments by my Au barrister and it was (at law in Australia anyway) as I thought. However, casting Keithj's attitude to consumer protection aside

It's becoming really annoying that helpful warnings about con artists off are being deleted.

Shouldn't this site be about educating and discussing rather than protecting the ripoff merchants?

 

[Perp]

It's becoming really annoying that helpful warnings about con artists off are being deleted.

Shouldn't this site be about educating and discussing rather than protecting the ripoff merchants?

Without going into the merits of the particulars of this or any other case, I think there is more than enough information on this website, for anybody who looks, to make them aware of what to look out for. If they read all that's here and still get "done", then really, they've only themselves to blame, or they were happy to pay for whatever services/value they believe they received.

Just because we don't place any value on some of these companies, doesn't mean that it's wrong for other people to do so. If somebody gets a sense of security about buying through an organisation with an Australian phone number, even if they're paying handsomely for it, I don't see anything wrong with that, provided they're doing it with their eyes open. And eyes should be open by now!

 

[lawsjs]

Except Perp, its not handsome, it is despicable!

What is wrong with these guys being shamed into being reasonable?

Without someone having to wade through 1000 posts to find oblique references to something.

You know, reasonable as in something under a 200-300% markup? Even a paltry 50% profit margin might be considered handsome in some quarters!

Anyway - digression.

 

[geoffw]

Jeremy

You are casting aspersions at Keith when any decision is reviewed by all the mods and ultimately Ian Somers, the forum owner- who is the reason this forum exists. It is unfair to target the one mod whose name appears on the action when all are responsible.

We don't have the luxury of a lawyer. If a company is named adversely, it has been our experience many times that the company has threatened legal action. We don't really want to go there.

 

[Ocean Architect]

If not a default then a reset. I agree with you. BUT, there are still 230,000,000 tenants out there - and less than 10% of that figure is Australia.

I know more about the airports than most and I detest it. At least in BKK I would be happy to PAY the girls to frisk me again And again and .....

You just gave me a great idea - we should hire some BKK girls (and boys), start our own Transport Security Austhority, and put in a tender. People will be putting suspicious devices down their pants on purpose!

 

[lawsjs]

If I see a comment 'deleted by keithj' I thought it reasonable to assume keithj may have had at least a passing interest in the matter... Forgive my complete misunderstanding of the matter - possibly a change of policy might be in order to avoid such gross errors occurring again?

However the 'misunderstanding' arose the point was taken despite in my opinion (and my barrister it being an abhorrent point made at the expense of a number of people who at least in some cases can ill afford to throw away tens of thousands - in some cases hundreds of thousands - of dollars.

Aside from anything else your ultimate disclaimer 'the views expressed are not the views etc etc etc' is anyones get out of gaol free card.

What I should be doing now is looking up why rabbits that don't lay eggs anyway have the slightest connection with a bizarre religious fable set in a desert 2000 years ago - I didn't want to be reminded of the vilest predatory practices of the worst bottom feeders I have come across in 25 years of heavy international property investing.

I look forward to avoiding such thoughts in future and getting back to doing something interesting like finding Perp a pot of cash!

 

[Ocean Architect]

I disagree.

The US is the hub of innovation. It's certainly tough if you are poor and unskilled, but that's all the more incentive to make something of yourself. They will get themselves out of the hole they are in.

They have massive commodity wealth, but unfortunately for them, it is divided by 15 times as many people compared to Australia. The US supplies a lot of the world it's food, probably half the exportable surplus. Just the the state of Iowa produces twice the tonnes of corn as the whole of Australia grows wheat, and it's two thirds the size of Victoria. If the Middle-East were ever silly enough to denigh the US it's supply of oil, the US can starve them in retaliation.

The US is undergoing a slump. The US dollar is now back to where it should be. Now US exports will be competitive again, and they still have their manufacturing industries, unlike a lot of other places, including Australia. The US will be back.

See ya's.

I hope you're right, but doubt it based on what I have seen. The US is as deindustrialised as the rest of us - they shipped their jobs over to Chindia years ago, with an economy that relies on consumer spending and financial services for the most part.

Also I see the US dollar going a lot lower even in the short term - that's what happens when you counterfeit 2 trillion dollars out of thin air.

Anyway I hope they bounce back, since I prefer the US dominating the world than China or Russia, so long as they stop starting all of these wars!

 

[lawsjs]

OA,
Like your work!

 

[Ocean Architect]

OA,
Like your work!

Me? Work? Haaahahahaahaahahaahaahaa I think you may be talking to the most disgusting fat bludger on the forum

 

[Perp]

I look forward to avoiding such thoughts in future and getting back to doing something interesting like finding Perp a pot of cash!

Too right! That sounds like a very worthy occupation, indeed.