Puerto Vallarta has constant and renewed efforts to pick up garbage. The municipal government has a program to keep the beaches clean and the Directorate of Environment and Ecology have many programs that operate up and down the bay doing…
Home Swapping in Puerto Vallarta Home swapping has become very popular in the past couple decades and Puerto Vallarta loves the idea. It gives people a chance to see our city, as well as Puerto Vallarta homeowners having an inexpensive…
Papayas, bananas and mangoes abound in Puerto Vallarta and growing them is easy, given just a small plot of land. Our first home in Puerto Vallarta had minimum space to garden, yet we grew bananas and papayas in our parking…
Amigos The concept of friendship is different in Puerto Vallarta than that of the United States and Canada. North Americans might have many friends, through school, fraternal organizations, church, the neighborhood, Facebook. In Mexico, an amigo is someone you are…
Vegetarian Restaurants Many years ago we were delighted when Planeta Vegetariano opened on the north side of Our Lady of Guadalupe Cathedral. It was a great choice to treat our vegetarian friends and at the time it opened, there was…
Lessons in Not Overdoing Most people come to Puerto Vallarta and have a fabulous time. On the other hand, there are those who go overboard in all the wrong places, and we mean that literally. When you go to the…
We laid off sugar a few years back and have been very happy about the switch to honey. Local honey in Puerto Vallarta can be purchased on the streets and we often buy from the same grumpy old man who…
Pedicures: Our feet take a beating in Puerto Vallarta. We have an amazing collection of open toe sandals, from flip flops to fancy huaraches. Sneakers and hiking boots fill the remainder of our assortment of shoes. With toes showing most…
Jogging About Town We shudder when we see joggers in Puerto Vallarta on the highway between town and Mismaloya, sometimes with only inches between them and passing traffic. It’s a dangerous place to run. Most people are looking for solid…
One of the biggest worries of new house flippers is what happens when they can't sell their flips.
It's a legitimate fear…but one you don't need to have if you just take a few precautionary steps with your lenders ahead of time.
To do this though, it largely depends what KIND of loan you have on the house.
Here are two scenarios that you may come face to face with and how to deal with them.
When you're working with a private money lender – this could be a family member, a friend or a business acquaintance, you're the one who's setting the terms.
So when you write that promissory note, you're going to personally guarantee the loan. I do this on all my note holders; I personally guarantee them, depending on the situation.
If it's an equity deal, then it's a little different – but on a pure note we usually personally promise them. It's really important to me to make sure my lenders are well protected.
I do this because I don't want to be in a position where I can't pay off that note only because it went beyond the 12 months. So what we typically add in a stipulation our promissory note that includes a “when the property sells” provision.
The idea is not to make you lazy or give you a false sense of security, but to protect you in case hings go wrong.
Never forget that in house flipping, time is money and you never want to be in a property longer than six months.
This provision just gives you a little extra layer of protection to know that you're not going to be foreclosed on hard by your lender.
If you're in a deal with a hard money lender, then the rules are completely different…so this section is a bit more lengthy.
When you borrow hard money, the hard money lender creates the rules, they're professional lenders just like bank and most of them really know their stuff.
Some house flippers, eager to get their first deal funded with a hard money lender, get too aggressive and set their terms for six months.
Big mistake…
Never, ever, ever get into a six-month loan with a hard money lender. I don't recommend them…its just not enough time, especially when you're first starting out flipping.
Its completely plausible that you could buy a property and it could take you 60-plus days just to rehab it. Not that you want to take that long on a rehab, but it can happen.
If the rehab takes 60 days, thats two full months into it and only after that, you can list it and start the selling process.
But lets say its towards the end of the year and it took a couple of months for the selling season to come. Or perhaps you could sell ...read more