VA Foreclosure

Let's talk about the VA foreclosure. So I talked about single family houses. I talked about buy and hold. I've talked about a three bedroom, two bath in the right area, the right market, that whole thing. How does an investor get to play the game, especially a relatively new one? I mean, when you're a pro, you can do other things, but the VA foreclosure is a relatively simple strategy. Can I get a raise of hands that no one's ever heard that before. No one has any idea what I'm talking about. So the rest of you have. You've heard of it? You know about a VA foreclosure? Because let me just say this. In 1996, I bought a Carlton Sheets class on late night TV. I said, that sounds pretty good. So I got it, went through the whole thing and none of it made sense to me. None of it worked. I tried eight different things, none of them worked. But the VA foreclosure did. Here's the deal. With the VA foreclosure, a veteran buys a house. And that happens all over the country. If you buy a military base or say in this town, there's a lot more of them as opposed to somewhere out where there's no military, there's less of them. But a veteran gets 100% loan plus some of his costs paid. And when he buys that home, things change sometimes. Sometimes he loses his home. So when he loses his home, the VA has guaranteed that loan, that 100% loan. And he has no skin in the game, the veteran. And what they do is they take it and auction it off to anyone. A non veteran. I am not a veteran And I bought 30 of these things. So here's the beauty of it. The VA will finance you as an investor on that property that they've taken back. It's a 30 year loan, fixed below 4%, 5% down to an investor. And guess how many investors can get? 4, 10? Unlimited. You guys have heard this speech. So I see it as a unique opportunity right now. I mean, I've never seen the rates. I bought a lot of them, I bought a few of them. You know, basically depending on how the market was, how competitive it was, you know, different factors in the marketplace. So right now though, these interest rates. So let's take a house in Las Vegas. If you went on the VA Equator website right now, and I've written a blog about it, if you're interested, all the details, VA Equator website to look it up. You look for a VA foreclosure in a Certain town you can pick California, Nevada, any state in the country. There's a big map of the country. And so you pick a three bedroom, two bath house because you believe those are the best houses out there. And the bottom line is that house, let's say costs $100,000 at 4% even with only 5% down, your total outgo is about $600 a month total. That'll rent for 1,000. So you might say, well, the house could go down, it could, but you're okay. And it's a good long term hold. And if you're doing your taxes right, you know, you get a tax write off on it too. And the loan advertises, it's a beautiful thing. Once again, I've got 30 of them, I've sold some of them off. But the VA foreclosure was a great way to buy single family houses in all the areas. But any questions on that? Any question on the VA foreclosure, anybody? Yes sir. What's the website for? Yeah, let me start by saying you can go to my website realestatenotinvesting.com and get the full article on it. But it's VA Equator. If you Google VA Equator it'll come up. And right now it's a little bit in flux. Where bank of America had it, it's a national program. And bank of America out of Pasadena had a center that did just VA foreclosures. They're in the process of losing it and they've had it for about four years now. Hoffman had it before them. So it's understandable why they're losing it through their nightmare. And you do have to qualify. Let me say that too. You have to kind of run their Gauntlet. They like W2 jobs but we can always partner with the person that has one. If you don't have that, whatever. But it's worth looking at. It really is, you know, to get an unlimited amount of properties with 5% down fixed below 4% financing. So yes sir, Is your website with a ampersand or an A and D? A and D. I'm sorry, I'm sorry. The question was is my website. It's realestate a n d noteinvesting.com that's my website. And the question, I'm sorry, what did you. What was the question again? I know, I answered it. VA Equator.com? yeah, VA Equator is the website that they're all listed on. So. Yes sir. Is that the same as the VA vending program? As bank of America losing It. Who is it going towards? Not sure yet. But yes, his question was, is it the VA vending program? The VA vending program is the financing end of it is what it's called. And when you call up the broker on the property, they won't know what you're talking about. They'll say, what are you, a veteran? You say, no, I'm looking at the VA vending program, blah, blah, blah. But it is the VA vending program and it's on the website. You can, you can check it out. Any other questions on the VA program? Yes, sorry. The $600 a month, is that financing only or is that including operation costs like maintenance and things like that? Piti, I'm sorry, can I ask you a question? Was the $600 inclusive of everything, including maintenance, et cetera? Is that your question? But yes, that $600 would include principal, interest, taxes, insurance, myself. On top of that, I've got properties in Las Vegas that I don't manage.7%. I pay the manager to manage the properties. And then there's always maintenance costs on top of it. But you know, in the business for a while, I normally say, even on a single family house, a nice one, I'll take 30, 40% off a thousand dollar rent and say that's about what it costs if you buy a newer house, which you can right now. If you buy a newer house, you got a brand new air conditioner, you got a brand new roof. All the stuff that costs a lot of money to fix is new. So there's a whole slew of properties out there that you can pick up that are in good shape that will have lower maintenance right now. So all those houses that were built in 0506, they're for sale right now through the VA program. So I would encourage everybody to at least check it out. Do you go out and actually inspect the houses yourself? I think we all have different situations. My situation is I have family in Las Vegas and so I have a brother there and a sister and a father. And so they kind of go out and look at it for me. I also have a property manager who could drive by. But the issue is with say, you know what, I want to buy it in San Diego. VA deals, it's a lower end property that the veteran usually bought. So in San Diego it's usually a condo. In Las Vegas it'll be a single family house. In Arizona, it'd be a single family house. So do I inspect them? No, but I have somebody do it for me. So yes, sir. What about the underwriting, as far as how much they calculate of the rent or the potential rent that became. Yeah, yeah. They usually go by the certain price rule like FHA and B and regular conventional lending. Yeah. The question was the underwriting on it and how do they do it? It's about exactly the same. It's 75. Yep. There are beautiful things to this program. I mean there's no appraisal. So a lot of these are based on an appraisal. You don't have that, but it's about 75%. I haven't done it for two years now. But a person that I worked with last year did, got five of them last year and did them one at a time because say you're underwriting, you know, you do one and then now you have to get that one rented and that one counts on your income. Now you go to another one. But yeah, 75% I think is a good guideline. Haven't been through that gauntlet this year, but I think you're probably on track there. Okay. Okay. Mayor, you, me. Okay, so what kind of discount is it for the value? The way I put it is this. The question was what kind of discount do you get when you buy these? And the answer is none. What you're doing, you're not going to steal the house, you're going to steal the financing. That's what you're after. So here's how it normally goes. There's $100,000 house. And you call the broker and you say, hey, I'm Gordon, I'd like to buy that house on ABC Street. And they say, well we've got five other offers coming in on Friday. And you say, okay, well what's the. I'm already pre qualified with bank of America, I've got my letter. What's the price it's going to take to win the house? What's the highest offer now? Well, I couldn't tell you that. Well, let me ask you again, what's the price to get the house? 103. Okay, so I bid 105. I've usually had to outbid people to get the deal, but once again it's a financing deal and it's a long term hold deal. So you won't steal a VA4 cruiser.