Chef Jim Posted April 28, 2010 Share Posted April 28, 2010 What GG points? Okay so you know that CDC's are formed as a private entity and they can recieve funding from anyone that is willing to give into the CDC...that includes federal state and local...the city budget is the biggest investor because they stand to gain the most from revitalizing the city...I know both the next mayor and two council members...they are wanting me to run for mayor myself and if I do that and win...then it's SO on...if not, I can persuade the votes I need to get funding from the city...considering the benefits...so that's where the funding is coming from...local...not from you the average dude in east chuckayaknowwhere... Good luck getting funding as a politically exposed person. Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 28, 2010 Share Posted April 28, 2010 Good luck getting funding as a politically exposed person. That makes no sense...as a Mayor with two council members I have a working relationship with...we can budget to give to the CDC...i don't need people to "give"...like the average dude to give me money...we will give from the city budget to rebuild the city...wow new concept...I am not drawing some ridiculous salary from the corporation...so the IRS can look me up and down, like I am sure they would...considering it will look like I'm "stealing" money...but they won't find any problems because I'm not a banker I don't need private jets or a million dollar bonus...it is barebones and if I am drawing a modest salary of 30k from the CDC I will put the Mayors salary down to 1 dollar like NY does...if I am drawing the salary as Mayor I will not draw one from the CDC...at any rate I'm not going to be paid personally more than 50k in a combined salary which is lower than what the current mayor makes now...I am sure I can sell the idea to my friends in city hall especially if I am there as the Mayor Link to comment Share on other sites More sharing options...
Booster4324 Posted April 28, 2010 Share Posted April 28, 2010 That makes no sense...as a Mayor with two council members I have a working relationship with...we can budget to give to the CDC...i don't need people to "give"...like the average dude to give me money...we will give from the city budget to rebuild the city...wow new concept...I am not drawing some ridiculous salary from the corporation...so the IRS can look me up and down, like I am sure they would...considering it will look like I'm "stealing" money...but they won't find any problems because I'm not a banker I don't need private jets or a million dollar bonus...it is barebones and if I am drawing a modest salary of 30k from the CDC I will put the Mayors salary down to 1 dollar like NY does...if I am drawing the salary as Mayor I will not draw one from the CDC...at any rate I'm not going to be paid personally more than 50k in a combined salary which is lower than what the current mayor makes now...I am sure I can sell the idea to my friends in city hall especially if I am there as the Mayor Where does the city get its budget from? Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 28, 2010 Share Posted April 28, 2010 Where does the city get its budget from? Property taxes and fees/licensing/tickets etc...NOT INCOME TAXES...NOT GOODS TAXES in most cases... Property taxes...biggest revenue by FAR...and this "investment" into community development INCREASES property tax revenue...THEREFORE...it is an INVESTMENT not a HANDOUT...it will increase both the value of homes in the city around these run down properties...THAT WILL INCREASE REVENUE...and it will provide MORE ownership THAT PAY MORE TAXES... Our estimates is that tax revenue will increase about 3% to our city...and then another 15% payback from CDC to city over the course of time...brings the total budget down (during the pay into the CDC years) 10%...increases the budget after two years CDC begins to pay back the pay out...and the budget increases to five percent higher than it is now for the next twenty years...and that is not adding the increase in property tax revenue INCREASES from higher property value...that is going on current appraisals of all property...we can't really effectively know how much property value will increase before we actually fix these properties up, only that it will be more and equal more revenue for the city...but a five percent increase in the budget for the long term by cutting the budget 10% over two years is a very easily sold plan Link to comment Share on other sites More sharing options...
Booster4324 Posted April 28, 2010 Share Posted April 28, 2010 Property taxes and fees/licensing/tickets etc...NOT INCOME TAXES...NOT GOODS TAXES in most cases... Property taxes...biggest revenue by FAR...and this "investment" into community development INCREASES property tax revenue...THEREFORE...it is an INVESTMENT not a HANDOUT...it will increase both the value of homes in the city around these run down properties...THAT WILL INCREASE REVENUE...and it will provide MORE ownership THAT PAY MORE TAXES... Is the property tax a flat rate or an increasing percentage with the value of the property? Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 28, 2010 Share Posted April 28, 2010 Is the property tax a flat rate or an increasing percentage with the value of the property? It's a small crappy little city...the current taxes are 10.50 per thousand about...and for commercial property it is around 12 I believe...haven't looked into the higher end property taxes really, just going by memory of the taxes I scanned over to find what "my" tax rate will be Link to comment Share on other sites More sharing options...
Booster4324 Posted April 28, 2010 Share Posted April 28, 2010 It's a small crappy little city...the current taxes are 10.50 per thousand about...and for commercial property it is around 12 I believe...haven't looked into the higher end property taxes really, just going by memory of the taxes I scanned over to find what "my" tax rate will be One more question, will you inevitably make a ton of money if this works out for you? Maybe down the road say. I am not saying that is a bad thing if so. Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 28, 2010 Share Posted April 28, 2010 One more question, will you inevitably make a ton of money if this works out for you? Maybe down the road say. I am not saying that is a bad thing if so. No...all the profits will go into buying more low end property to keep the ball rolling and so we don't have to keep getting funding from outside sources...I will never be a rich man doing this...I will never be a rich man period...that's not my goal...I just want to do something worthwhile...and earn a decent living doing it...I will never draw a crazy salary...not anytime soon, not anytime down the road...I will always live in the urban inner city with my house paid for and low liability costs...I don't have expensive taste and as long as my family and I are able to eat, and pay our bills on time I am a happy guy...I will never draw a salary of more than 50k no matter how large the CDC gets Link to comment Share on other sites More sharing options...
Booster4324 Posted April 28, 2010 Share Posted April 28, 2010 No...all the profits will go into buying more low end property to keep the ball rolling and so we don't have to keep getting funding from outside sources...I will never be a rich man doing this...I will never be a rich man period...that's not my goal...I just want to do something worthwhile...and earn a decent living doing it...I will never draw a crazy salary...not anytime soon, not anytime down the road...I will always live in the urban inner city with my house paid for and low liability costs...I don't have expensive taste and as long as my family and I are able to eat, and pay our bills on time I am a happy guy...I will never draw a salary of more than 50k no matter how large the CDC gets If that is the case, I don't see an issue with it ethically. Good luck on the legal and management bit. Link to comment Share on other sites More sharing options...
GG Posted April 29, 2010 Share Posted April 29, 2010 What GG points? The point that you're taking the same programs targeted at subprime borrowers, painting them with a fresh coat of paint, renaming them and thinking you have a winning formula. Yet, the credit profile of your tenants/buyers is still pretty bad and you have nowhere near the financial resources of the idiots who got into trouble in the first place. The probable default rates among your target crowd is going to be sky high and you'll blow all your money on lawyer & repo retainers. Link to comment Share on other sites More sharing options...
erynthered Posted April 29, 2010 Share Posted April 29, 2010 The point that you're taking the same programs targeted at subprime borrowers, painting them with a fresh coat of paint, renaming them and thinking you have a winning formula. Yet, the credit profile of your tenants/buyers is still pretty bad and you have nowhere near the financial resources of the idiots who got into trouble in the first place. The probable default rates among your target crowd is going to be sky high and you'll blow all your money on lawyer & repo retainers. Shhhhhhhh. Donald Trumps books sales are falling as you type. Link to comment Share on other sites More sharing options...
Wacka Posted April 29, 2010 Share Posted April 29, 2010 Where does the city get its budget from? Obama's stash Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 29, 2010 Share Posted April 29, 2010 The point that you're taking the same programs targeted at subprime borrowers, painting them with a fresh coat of paint, renaming them and thinking you have a winning formula. Yet, the credit profile of your tenants/buyers is still pretty bad and you have nowhere near the financial resources of the idiots who got into trouble in the first place. The probable default rates among your target crowd is going to be sky high and you'll blow all your money on lawyer & repo retainers. No, I'm not taking the same programs built for subprime borrowers...subprime borrowers pay so much more per month than they can afford if they are even approved to begin with...which is the MAIN reason they default...because they are not "qualified" to get fixed rates...they are sold ridiculous loans that they couldn't possibly pay off...they are "renting" from the banks, but at a much higher monthly payment than I will give them...this is why financial guys don't understand the plan...it's because they haven't been in the struggle and don't understand why people actually default...when they are late, they get more fees..."sorry you couldn't afford your monthly payment this month on time, dont' worry sir we added on another two hundred dollars to make it more affordable"..."sorry you can't afford your arm loan anymore because we added on a few points and your monthly payment increased 300 dollars, as a homeowner you should know that it is bound to happen...GET OUT."..."I'm sorry I gave you a loan that was interest only, we really thought you, being a mechanic, were trying to invest and flip the house and not live there...now you're upside down in your mortgage...I thought we explained it very well in the 9000 page mortgage agreement we sent to you...too bad for you...GET OUT and STILL OWE US MONEY."...catch my drift?... My plan differs in that there is protective mechanisms to KEEP THEM IN THE HOMES not kick them out...my plan is different because the monthly payment is CHEAPER THAN RENT...not twice as much for those that make less than the average salary...my plan is different because whatever I sell them, they can resell for the same amount or more...meaning they INVESTED ALL THIER MONEY...not spent it on financing fees... Even if they do default...it will not be that costly...I LIVE WITH THOSE "TENANTS/BUYERS" whose financial history makes you financial guys cringe...I KNOW why they default...I KNOW that they are not some deadbeat shmuck that just doesn't FEEL like paying thier mortgages...I KNOW they were suckered into horrible mortgage loans because they had a dream to actually OWN something...I KNOW that given a fair shake, they will do everything they can to KEEP thier investments...I worked for a man who was in the same area, not exactly the same area, but only one city over from my target city and I painted and fixed the homes for him...he owned 15 properties...in ten years he had one eviction...these are just low income renters about 3 per property...that's no different than the foreclosure percentage in America...very close...that's a group of hard working low paid citizens versus the generally approved buyers of property... Even if I have to evict at a slightly higher rate, just because I'm soooo very unlucky to attract more "deadbeats" than the landlord I worked for...(highly unlikely considering same neighborhood same low income and low credit scores)...I would still not rack up this outrageous debt from lawyer fees...filing an eviction notice is fairly cheap...proving it is fairly easy considering I will have the agreement spelled out pretty clearly...also, I am working to keep them IN the home...so I will be much more FORGIVING...of those that are struggling...if they have say two years of ontime payments and get laid off, I will work with them to make sure they stay...forgiveness, that's alot different from those subprime programs y'all put together now isn't it?... On top of, if they do just have to move to a single bedroom rat hole becuase thier life changed so drastically they just cannot muster up the 500/month anymore, I will work an agreement out with them personally...WITHOUT COURT...so that they may recieve percentages of what they paid in while another person moves into thier home...at any rate...if you do the footwork yourself...most evictions can be avoided...and the small amount that cannot be avoided are not that costly...go to court and fight a few and you'll see what I mean... Link to comment Share on other sites More sharing options...
Booster4324 Posted April 29, 2010 Share Posted April 29, 2010 Celtic soulja you sound a bit crazy, but your heart seems in the right place. I genuinely hope it works out for your town. Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 29, 2010 Share Posted April 29, 2010 Thanks Booster...I am a little crazy...I mean I could flip houses and make way more...but I'm not a big money fan hehehee..that in itself shows I'm naive and crazy...but I hope it works out to...nobody else is clammoring to rebuild the ghetto... Link to comment Share on other sites More sharing options...
DC Tom Posted April 29, 2010 Share Posted April 29, 2010 The point that you're taking the same programs targeted at subprime borrowers, painting them with a fresh coat of paint, renaming them and thinking you have a winning formula. Yet, the credit profile of your tenants/buyers is still pretty bad and you have nowhere near the financial resources of the idiots who got into trouble in the first place. The probable default rates among your target crowd is going to be sky high and you'll blow all your money on lawyer & repo retainers. And he's going to soak them for even more money than the "evil bankers". Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 29, 2010 Share Posted April 29, 2010 And he's going to soak them for even more money than the "evil bankers". You keep saying that but you fail to prove that I am "soaking" them for more than the bankers...I am selling them a product for what it is worth...what I bought it for does not change the simple fact that they can buy it from me, and sell it for the same amount or more...that's a real asset not a liability like a friggen subprime mortgage Link to comment Share on other sites More sharing options...
DC Tom Posted April 29, 2010 Share Posted April 29, 2010 You keep saying that but you fail to prove that I am "soaking" them for more than the bankers...I am selling them a product for what it is worth... So are the bankers. Look, you want to sell houses on a "rent to own" basis at a 200% markup. The total cash outlay you're asking for is equivalent to a 30-year mortgage at 9.25%. The monthly payment you're asking for is equivalent to the payment for a 30-year mortgage at 19%!!!! A 15-year mortgage at 12% - which is a higher interest rate than most consumer loans - is $115 less a month and $36k less in total than your pricing structure. So don't start pretending you're any better than bank mortgage rates. There's no way you can slice the numbers that makes mortgages worse. You can argue that you're providing home ownership opportunities to people that otherwise couldn't buy a home...but you're still pulling more money out of them than the banks would. And I'm not complaining about your financial structure...the extra money you're charging is commensurate with your risk of dealing with poor credit risks. But don't pretend for a minute you're any better than a mortgage lender for it. Link to comment Share on other sites More sharing options...
Celtic_soulja Posted April 29, 2010 Share Posted April 29, 2010 So are the bankers. Look, you want to sell houses on a "rent to own" basis at a 200% markup. The total cash outlay you're asking for is equivalent to a 30-year mortgage at 9.25%. The monthly payment you're asking for is equivalent to the payment for a 30-year mortgage at 19%!!!! A 15-year mortgage at 12% - which is a higher interest rate than most consumer loans - is $115 less a month and $36k less in total than your pricing structure. So don't start pretending you're any better than bank mortgage rates. There's no way you can slice the numbers that makes mortgages worse. You can argue that you're providing home ownership opportunities to people that otherwise couldn't buy a home...but you're still pulling more money out of them than the banks would. And I'm not complaining about your financial structure...the extra money you're charging is commensurate with your risk of dealing with poor credit risks. But don't pretend for a minute you're any better than a mortgage lender for it. You are missing the point thanks to your tunnel vision...if I finance a house for market value, I can't turn around and sell it for what I paid for it...interest is drummed up and there is no product to recoup your money...not a real investment unless the market falls in your favor HEAVILY....again a 200,000 home financed costs 500,000 on a good mortgage...you can't sell it for 500,000...it's still worth the 200,000 of the list price...I'm going to try to help you understand again... I am buying foreclosed homes that need work...in current condition the bank will not finance a joe shmoe for the home...they would possibly finance an investor dhead that wanted to flip it...but not some guy that wants to live there...again, they cannot finance at 12 percent to live in these homes...these are investor specials...I am using my resources to rebuild a community...to give people homes at the fair market price...they can turn around and recoup ALL the money they put in, maybe more...I am not taking money just because I am me, like the banks do...I am not selling convenience...I am selling property at market value, no more, and I am doing the leg work to make that happen...I'm not making any excess profits like the banks do...I am not across the board marking up the properties 200%...I am looking for houses I can make that amount on...and still be fair to the client...when you buy something, do you care how much they paid for it, or how much you will be able to resell it for?...that's the bottom line... If I came to you with a collectors item and said I paid fifteen bucks, but it's worth forty thousand...in ten years it is supposed to be worth fifty thousand...I'll take thirty nine thousand for it... Or I got this item that I paid fifteen bucks for, I'll sell it for twenty bucks, but it's not worth twenty it's worth fifteen bucks.... Which item are you going to buy? Link to comment Share on other sites More sharing options...
DC Tom Posted April 29, 2010 Share Posted April 29, 2010 You are missing the point thanks to your tunnel vision...if I finance a house for market value, I can't turn around and sell it for what I paid for it...interest is drummed up and there is no product to recoup your money...not a real investment unless the market falls in your favor HEAVILY....again a 200,000 home financed costs 500,000 on a good mortgage...you can't sell it for 500,000...it's still worth the 200,000 of the list price...I'm going to try to help you understand again... I am buying foreclosed homes that need work...in current condition the bank will not finance a joe shmoe for the home...they would possibly finance an investor dhead that wanted to flip it...but not some guy that wants to live there...again, they cannot finance at 12 percent to live in these homes...these are investor specials...I am using my resources to rebuild a community...to give people homes at the fair market price...they can turn around and recoup ALL the money they put in, maybe more...I am not taking money just because I am me, like the banks do...I am not selling convenience...I am selling property at market value, no more, and I am doing the leg work to make that happen...I'm not making any excess profits like the banks do...I am not across the board marking up the properties 200%...I am looking for houses I can make that amount on...and still be fair to the client...when you buy something, do you care how much they paid for it, or how much you will be able to resell it for?...that's the bottom line... If I came to you with a collectors item and said I paid fifteen bucks, but it's worth forty thousand...in ten years it is supposed to be worth fifty thousand...I'll take thirty nine thousand for it... Or I got this item that I paid fifteen bucks for, I'll sell it for twenty bucks, but it's not worth twenty it's worth fifteen bucks.... Which item are you going to buy? No, I'm not missing the point. You're buying cheap properties and selling them at a significant premium above what you paid. That's not noble, that's profiteering. YOUR tunnel vision is missing that. You seem to think that because you're facilitating home ownership to those otherwise ineligible, your profiteering isn't profiteering. Largely because you have a seriously fallacious view of the idea of the "market worth" of a house. Here's a hint for you: the value of foreclosed homes in my area didn't increase to the value of my home after foreclosure...quite the opposite, in fact. Link to comment Share on other sites More sharing options...
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