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Expert: John Hendricks - 6/9/2008


Question
I am looking to buy a home in a year or two but I am wondering how would be the best way of going about buying a home with multiple people.  I have one really close friend another friend and possibly my brother who all want to go in on this.  We would buy the home together and live in it all together.  Our rent would just be the monthly mortgage payments and when we sold the house we would distribute the total value of the house.  I was wondering how would you go about doing this or if you have dealt with anything like this in the past?  Some suggestions that were given to me were to create a company and have each of us own a portion of the company and have the company own the house?  Also I thought of putting the house under my name getting 5,000 from each person for the down payment then everyone pays me rent monthly.  Could this be similar to how people jointly own time shares and homes in Florida?

Answer
Dear Ross:

Thank you for your good question. In California where I am a Realtor, this form of purchasing property is not uncommon, especially with the tight economy that we are currently are experiencing. You are smart to start the process now instead of waiting to the last minute.

The type of ownership that would be used for this partnership is “Tenants In Common”. You would first want to get your group of buyers together and meet with a mortgage broker to determine the quality of each buyer in the purchase since all would have to qualify for the loan. The mortgage broker should understand what requirements each party would need to provide the lender to get qualified for the loan. This will help determine the loan amount you would qualify for, the amount of down payment needed between all parties, the loan rate and overall costs to obtain the loan.

The second thing you would want to do is meet with a real estate attorney who will draft the agreement including each of the investors, the divided portions of ownership, potential buy outs, shared expenses, and all other related concerns to the shared interest in the property.

The third thing to do is find yourself a Realtor who is familiar with what you all are trying to achieve. The Realtor will help you through the process of guiding you through the process of not only finding you the right home, but help you understand how the procedure in a “Tenants in Common” ownership is facilitated.

Please remember that I am a Realtor in California, and not familiar with the laws of Florida. When you contact a mortgage broker, they will probably be able to confirm what the laws and regulations are in the State of Florida and will help guide you initially. If you need the name of a good mortgage broker or Realtor where you want to buy your property, let me know your name, contact information, and where you want to buy this property, and I will provide you with a couple of quality Realtors and Mortgage Brokers to contact. I hope this helped you… take care and good luck.

Warmest Regards:
John Hendricks
JohnHendricks@Marin1.com
415-259-4518

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John Hendricks

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As a California Realtor for 23 years practicing in Marin and Sonoma Counties, it is now time to provide counsel through AllExperts.com to those who need advise in real estate. My knowledge and experience includes a wide range of resale residential real estate purchases, new home sales, income related investment properties involved in 1031 exchanges, and land. Let me help you in any of these areas...

Experience

John Hendricks has established himself as one of Marin & Sonoma Counties premier Realtors. A native Californian, John is a well-known and respected Realtor in both Marin & Sonoma Counties who has resided in the Northbay since 1976. John began his real estate career in 1986, and since then has distinguished himself as one or Northern California's top producing Realtors. Before joining Frank Howard Allen Realtors, John was an associate of the Prudential California Realty from 1990-1992 where his outstanding sales achievements earned him one of the company's highest honors, the prestigious "President's Circle Membership", presented to the top 2% of associates for sales and earning excellence. Since his association with the highly regarded Frank Howard Allen Realtors in 1992, John has once again established himself as one of his company's Top 10 Producing Realtors in Marin & Sonoma Counties for the years 1993 through 2007 and now in 2008. Five continuous years of outstanding performance has now allowed John to join 15 other Realtors in the prestigious "Lifetime Hall of Fame" for Frank Howard Allen Realtors. John established a group of professional individuals who specialize in a variety of areas in real estate called, 'Lundmark-Hendricks Fine Homes' This group of professionals are dedicated to the success of representing clients with the greatest amount of care and service when either buying or selling real estate.

Organizations
California Association of Realtors National Association of Realtors

Education/Credentials
Upon Request...

Awards and Honors
Frank Howard Allen Realtors "Hall of Fame Member" Chairman's Circle for 10 consecutive years

Past/Present Clients
Joe Louis & Sharon Sigurdson We want to thank you again for your excellent representation of interests during the recent purchase of our home in Petaluma as well as the sell of our home in Mill Valley. We had the unusual pleasure of working with you during the last year both as sellers and buyers. We felt that our interests were always paramount and that we received a very fair price for the sale of the Mill Valley house as well as our purchase of our new home. This speaks particularly well of you, because of the recent unstable and chaotic real estate market. Will Finke "Quite frankly, we came out of a very difficult situation, which time does not allow elaborating on. This was one of the greatest experiences of our lives as clients. John Hendricks is one of the top businessmen I have ever met." Bruce & Nancy Rosentreter "I chose John Hendricks to sell my house. I picked him because I thought he was professional, aggressive, and that he could get top dollar for my house. He fulfilled my expectations completely." Joy Schuelke "Since we were trying to sell a high end home in a very tough market, and in the middle of a very rainy winter, the prospects seemed quite bleak. I was convinced at the time, and am even more so now, that without John's tenure, patience, and tenacity, we would have not been able to move the property." Lynn McCarthy "I cannot stress strongly enough how impressed I was with the service provided to me by John and his group. Throughout the entire transaction, John was always available, always forthcoming with excellent advice based on his years of experience, and always willing to put in the extra effort to make this a positive experience for me. I feel lucky to have had the experience of working with him." Lea Lieurance-Turk "Thank you John for your outstanding real estate services for the past 5 years I have known you. You have made my dreams come true as far as selling and buying property."
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