Real Estate Broker · Fort Myers, FL · Member since 2008 · 1k+ posts · 323 votes
11y
We have been doing owner carry deal on assets the banks will not fund. Example. Bought double wide for 20K as part of a package. Tenant moves out and trashes the place. Sold the asset for 29,900 "as is" with 5k down. 5 year note at 9 percent. ***Just make sure you check income docs to ensure they can afford the home. Based upon the arbitrage of our purchase versus the exit deal. That had a 31 (unlevered) percent a year COC return for 5 years. That is if he stays under the note for 5 years.
When EMPLOYING capital there are few basic questions you have to ask yourself.
1. What is my minimum rate of return. Opportunity cost should be tied to other yields available.
2. When will I need this money back?
3. How much capital are you working with? Here it is defined.
4. What is my risk tolerance?
PS spend twice as much time underwriting the downside as the upside. To have a return on investment makes getting the return of the investment pretty critical. The golden goose is in season, go get em!
Rental Property Investor · Dubai, United Arab Emirates · Member since 2017 · 27 posts · 8 votes
8y
Here I was thinking I'm going to see some advice on buying a few SFRs etc, but wow, note investing huh?
This is the great thing about this site - so many different personalities. I am inspired to properly read up on note investing or hard money as I think for my personal situation that would bring me greater traction as I start my investing career than those first few SFRs until I am in a position to really scale up.
Here I was thinking I'm going to see some advice on buying a few SFRs etc, but wow, note investing huh?
This is the great thing about this site - so many different personalities. I am inspired to properly read up on note investing or hard money as I think for my personal situation that would bring me greater traction as I start my investing career than those first few SFRs until I am in a position to really scale up.
I thought the same thing, lol. I've read a bunch of books on note investing, hard money lending, etc, but it's tough when you're just getting started to know which direction to take. I'd like to buy a cash flowing single or multifamily home in the Olathe (KC suburb) area but the ROI just isn't there compared to KCMO unless you're investing for appreciation and not cash flow. After looking for the past 3 months I'm trying to expand out to the Missouri side but I haven't had good luck getting responses from listing agents so far...need to find a good real estate agent over there.