My Cash...is Worthless.

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My Cash...is Worthless.

Casey Roman
Member since 2018 · 26 posts · 34 votes

I have been trying for years to reinvest $100,000 into some form of real estate and have gotten absolutely nowhere. Because I own my own business and deduct HEAVILY off it, I qualify for zero mortgages, even with perfect credit. Moreover, Coronavirus has successfully killed my shot at non-traditional loans. 

I live in a highly desirable coastal area. There is no such thing as buying the $60k house here, doing repairs and re-listing at $250k. Even complete dumps are $150k so my $100k goes nowhere. Land is a fortune.

Without a mortgage I can't buy a rental property with just $100k. I've tried wholesaling but given the desirability of this area, most homeowners think they have oil under their property and can sell for far more than I can offer them.

It seems like my only option is to buy a double wide or invest in REITs - neither of which overly thrill me. 

The biggest need here is affordable housing. 

Its easy to feel like you've run out of options after slamming your head into the wall so I wanted to check in here. Are there other avenues of real estate investing I'm overlooking? Other financing I've ignored? Or...do the cards just fall sometimes where it's just not favorable under your personal circumstances?

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Joseph CacciapagliaBusiness Member
Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes
6y

You could be a private lender, yields on private loans have jumped up lately. You could invest with a partner or in a syndication. You could invest out of state. Most of my clients are from a more expensive market. If you have cash, you can certainly get into the game. You might just need to get a little more creative.

[email protected]979-218-2286
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  • Joseph CacciapagliaBusiness Member
    Lender · San Antonio, TX · Member since 2020 · 1k+ posts · 1k+ votes
    6y
    Originally posted by @Anthony Liguori:
    Originally posted by @Joseph Cacciapaglia:
    Originally posted by @Anthony Liguori:
    Originally posted by @Joseph Cacciapaglia:

    You could be a private lender, yields on private loans have jumped up lately. You could invest with a partner or in a syndication. You could invest out of state. Most of my clients are from a more expensive market. If you have cash, you can certainly get into the game. You might just need to get a little more creative.

    your a turnkey company?
     

    No. I'm an agent at a real estate brokerage with an in house property management team. I spend most of my time helping investors find properties in San Antonio. We'll often also manage those properties, but we're not selling turnkey properties directly. What gave you that impression?

     I think you said something about your clients are out of state.. So thats why I asked.. Hows your market? A lot of out of state investor invest in your area?

     Yes, about 80% of my business last year was helping out of state investors find properties. San Antonio is a popular market with out of state investors, because it's the most affordable top 10 city in the country. I work with a lot of nerdy data driven value investors that expect San Antonio to outperform other major metros over the next decade plus. These types of investor focus on major metros, because they're generally risk averse, and realize some of the smaller "cash flow" markets can disappear overnight. So far properties are still selling quickly here, and there hasn't been much pull back in pricing on investor deals. For slightly larger multifamily, we're seeing a little softness, but that's the only effect I've noticed so far.

    [email protected]979-218-2286
    Joseph Cacciapaglia powered by Morty
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    0Reply
  • Anthony Liguori
    Rental Property Investor · NJ (new jersey) · Member since 2019 · 113 posts · 16 votes
    6y
    Originally posted by @Manny Fernandez:

    @Casey Roman I didn’t read all replies but I would be happy to partner with you here in DFW. Fund the hard money points and interest and I will manage the project and do the rehab and we split the profits in the end. We can handle 4 projects at a time. Let me know if you’re interested. Thanks!


    I’m interested in receiving more information on this idea you have 

    0Reply
  • Casey Roman
    OP
    Member since 2018 · 26 posts · 34 votes
    6y
    Originally posted by @Ryan Lewis:

    Shoot why not partner up....?

    Of the investors I know locally, any time I mentioned this their eyes got huge and the response was "DON'T DO IT." For various reasons. Different work ethics, different ethics entirely, unpredictable changes on either side.

    I got the impression they had been burned far more times via partnerships than helped. 

    0Reply
  • Shiva Bhaskar
    Investor · Los Angeles, CA · Member since 2017 · 523 posts · 476 votes
    6y
    Originally posted by @Casey Roman:

    I have been trying for years to reinvest $100,000 into some form of real estate and have gotten absolutely nowhere. Because I own my own business and deduct HEAVILY off it, I qualify for zero mortgages, even with perfect credit. Moreover, Coronavirus has successfully killed my shot at non-traditional loans. 

    I live in a highly desirable coastal area. There is no such thing as buying the $60k house here, doing repairs and re-listing at $250k. Even complete dumps are $150k so my $100k goes nowhere. Land is a fortune.

    Without a mortgage I can't buy a rental property with just $100k. I've tried wholesaling but given the desirability of this area, most homeowners think they have oil under their property and can sell for far more than I can offer them.

    It seems like my only option is to buy a double wide or invest in REITs - neither of which overly thrill me. 

    The biggest need here is affordable housing. 

    Its easy to feel like you've run out of options after slamming your head into the wall so I wanted to check in here. Are there other avenues of real estate investing I'm overlooking? Other financing I've ignored? Or...do the cards just fall sometimes where it's just not favorable under your personal circumstances?

     Casey, what about finding a good syndicator with whom you can be an LP in their deal? Or, with $100K, you can go $50K into two deals. Another option is to partner with a few other investors in a joint venture - perhaps someone with a strong W2 so you guys get financing easily. 

    There are some great syndicators out there (and plenty of not so great ones), who could deliver a strong return, and you don't have to deal with day to day management of the property. There are many great resources on this topic on BP, and Joe Fairless' also has a lot of great information (join his list). It sounds like you're quite busy with your business, so maybe having someone else do most of the work makes sense? 

    0Reply
  • Joshawn McFadden
    Flipper/Rehabber · Saint Louis, MO · Member since 2020 · 12 posts · 2 votes
    6y

    @Casey Roman where are you from

    1Reply
  • Jon Q.
    Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
    6y
    Originally posted by @Casey Roman:

    I have been trying for years to reinvest $100,000 into some form of real estate and have gotten absolutely nowhere. Because I own my own business and deduct HEAVILY off it, I qualify for zero mortgages, even with perfect credit. Moreover, Coronavirus has successfully killed my shot at non-traditional loans. 

    I live in a highly desirable coastal area. There is no such thing as buying the $60k house here, doing repairs and re-listing at $250k. Even complete dumps are $150k so my $100k goes nowhere. Land is a fortune.

    Without a mortgage I can't buy a rental property with just $100k. I've tried wholesaling but given the desirability of this area, most homeowners think they have oil under their property and can sell for far more than I can offer them.

    It seems like my only option is to buy a double wide or invest in REITs - neither of which overly thrill me. 

    The biggest need here is affordable housing. 

    Its easy to feel like you've run out of options after slamming your head into the wall so I wanted to check in here. Are there other avenues of real estate investing I'm overlooking? Other financing I've ignored? Or...do the cards just fall sometimes where it's just not favorable under your personal circumstances?

     Actually, you CAN get a mortgage.  Check with portfolio lenders (ex BB & T Bank) and securitized lenders (ex Finance of America).

    These lenders use what you own as collateral and you may qualify by owning your own business and owning other collateral.  Obviously the more properties you own and are collecting income from, the easier it will be to obtain financing for future acquisitions.

    0Reply
  • Jon Q.
    Investor · Berkeley, CA · Member since 2015 · 1k+ posts · 713 votes
    6y
    Originally posted by @Casey Roman:
    Originally posted by @Joseph Cacciapaglia:

    You could be a private lender, yields on private loans have jumped up lately. You could invest with a partner or in a syndication. You could invest out of state. Most of my clients are from a more expensive market. If you have cash, you can certainly get into the game. You might just need to get a little more creative.

    This is actually what interests me the most. I'll be quite blunt...I am NO landlord. I have been in the past and I have also done AirBnb rentals and I find that my zero patience, zero brain-to-mouth editing function has severed me little in those realms. Joseph do you think I could get started in this with just $100k? Are there any education sources you recommend? I imagine the legal aspects are enormous and I'd like to start learning asap.

    Here’s my book list:

    (I’d suggest reading them in order)

    0Reply
  • Stone Saathoff
    Investor · San Antonio, TX · Member since 2019 · 576 posts · 307 votes
    6y

    Have you thought of investing out of state?

    Here in San Antonio, you can easily buy a rental property for under 100K cash.

    In your market it looks like there are a lot of obstacles.

    0Reply
  • Yoichi Kato
    Member since 2019 · 13 posts · 3 votes
    6y

    @Casey Roman have you considered becoming a private money lender? Not sure exactly how it works but might be an option. Also there are companies that does like group investing into a big project kind of like syndication.

    0Reply
  • Joshua Benjamins
    Lender · Virginia Beach, VA · Member since 2018 · 49 posts · 38 votes
    6y

    @Casey Roman I feel the best and cleanest way to invest in Real Estate is being on the banking side of things. Especially the Hard Money side. Usually money gets lent out for max 6 months and you can make a good return on your money. A old house gets remodeled and the neighborhood is happy.

    If you want to save on taxes get your money into a Self Directed IRA and any profits are now tax free.

    Toilets, tenants, and termites...no thanks.

    0Reply
  • Doug Beiswanger
    Real Estate Broker · MI (michigan) · Member since 2020 · 4 posts · 2 votes
    6y

    @Casey Roman I work with a lot of investors outside Michigan than like Michigan markets. $100k can buy multi-family homes all day long in my market.

    0Reply
  • Alex Penalva
    Kearny, NJ · Member since 2017 · 45 posts · 11 votes
    6y

    @Casey Roman

    Commercial loans, you should have plenty of solutions, and having extra money is never a problem. You must not be looking in the right places.

    0Reply
  • Doug JohnsonPro Member
    Investor · Pittsburgh, PA · Member since 2019 · 51 posts · 8 votes
    6y

    @Casey Roman

    Hey Casey,

    Sounds like a good problem to have.

    2 options stick out to me:

    1. Syndication- could be a great opportunity for a hands off approach

    2. Partner- find someone who will manage the property/ fix it up and all you have to do is provide the capital

    0Reply
  • Account Closed
    Real Estate Consultant · new york, NY · Member since 2019 · 34 posts · 28 votes
    6y

    @Casey Roman

    Sounds like you might need a partner

    1Reply
  • Holly Williams
    Rental Property Investor · New York City · Member since 2014 · 208 posts · 271 votes
    6y

    @Casey Roman. If you are an accredited investor you should look at a syndication especially if you want the passive income and tax benefits.

    1Reply
  • Chuks Erinne
    Rental Property Investor · Atlanta, GA · Member since 2017 · 221 posts · 188 votes
    6y

    @Casey Roman No such thing as running out of options. Have you considered creative financing techniques especially "subject to" or "owner/seller financing"?

    Also, you can invest or find these type of deals locally or in other suitable markets.

    This here is your opportunity...it all depends on how you look at it.

    If you have any questions about any creative strategy, please reach out.

    1Reply
  • Leo Chun
    Wholesaler · Scottsdale, AZ · Member since 2020 · 21 posts · 60 votes
    6y

    @Casey Roman Hi Casey! I hope this discussion has helped ease your mind and help you figure out what to do next.

    This is my first month in Real Estate, so relatively new, I was wondering why you didn't qualify for any loans? You said you had perfect credit, and obviously you have enough for a down payment for a good number of properties, so what happened otherwise?

    I wish you the best of luck on your endeavors!

    0Reply
  • Colin Fleming
    Member since 2018 · 17 posts · 3 votes
    6y

    100k as a private lender will fund many deals here in the mid-west.  I can help you find real estate investors/borrowers if interested.  You can structure short term deals for purchase and rehab with borrowers that have take out financing from traditional sources (banks etc.)  If you can turn your 100k several times per year you would have a decent yield.

    0Reply
  • Heath Jones
    Rental Property Investor · Enterprise, AL · Member since 2019 · 137 posts · 85 votes
    6y

    @Casey Roman You should look for a multifamily syndicator and invest in a deal with them as a limited partner. If the deal sponsor is experienced and the business plan is sound, then your money will make monthly or quarterly cash flow, and then at the time of sale, you will get your initial capital back and then also get an additional profit of any where from 50-125k depending on how much appreciation the sponsor was able to force. Then you take that and reinvest into another syndication and grow your money that way.

    In addition, as a limited partner owner, you receive all the tax shelter benefits associated with owning real estate such as depreciation. You don't have to BRRRr. You don't have to mess with tenants and toilets. If I had 100k to invest, I would not by myself another job, which is what you would be getting if you bought a SFR or even a small MF (I have both). I'm working this "second job" in order to grow my capital enough to start investing passively into MF syndications. You should too! Good luck!

    0Reply
  • Heath Jones
    Rental Property Investor · Enterprise, AL · Member since 2019 · 137 posts · 85 votes
    6y

    @Casey Roman Bottom line. Invest your money as a part owner in a multifamily syndications. We are all working toward being truly passive investors. That’s the quickest way if you already have the capital. The only work you do is on the front end vetting out the sponsors and the deals since you wire the money, you just collect checks until the team exits the deal and then you get a big check to reinvest...

    0Reply
  • Raine Garrett
    Real Estate Consultant · Memphis, TN · Member since 2016 · 10 posts · 4 votes
    6y

    @Casey Roman

    Hello Roman,

    You just need to buy property in other states....Check out the guidelines for the state you want to invest in...I am sure you can make great things happen...

    Tips for Real Estate Investing

    Superlady Raine

    0Reply
  • Michele Aldrich
    Architect · Sarasota, FL · Member since 2018 · 1 post · 0 votes
    6y

    Hi Casey,

    Have you considered foreign markets?  I know $100k here in Phuket can get you a decent condo near the sea and good offers through off-plan condotel developments with 'guarantee' 7-10% rental programs for generally around 5 years.  Of course, COVID is not ideal for the condotel market at the moment but it will bounce back and maybe it is something you haven't come across.  

    0Reply
  • Rachel Imhof
    Investor · Chicago, IL · Member since 2015 · 138 posts · 54 votes
    6y

    @Casey Roman if your looking for a serious partner I would be willing to listen and talk. We buy house here in Chicago for 60 to 70k with ARV's 200k plus easily. My husband and I have done 20 plus flips and 5 new construction homes with the current one a 1.5 million dollar spec that's already under contract. So we have done all levels of flips and new builds. PM me if you want to connect.

    0Reply
  • Diane Perry
    Member since 2018 · 34 posts · 11 votes
    6y

    @Casey 

    @Casey Roman Hi Casey,

    I totally "get" where you're coming from. I, too, am in a business where my expenses are extremely high compared to my income (musician) and COVID-19 has shut me down completely, possibly for a year and a half to two years. I, too, have great credit and no debt but one credit card, and even with my Mom co-signing with me (has tons of cash, stock and other liquid investments and owns her home outright) was refused by every bank I went to. This despite owning my own home in New Jersey, and a SFH in Nashville, TN that's rented out, with NO mortgages! I Even got turned down on a HELOC on my own home after being told I qualified for $250K.

    Don’t think it didn’t occur to me that despite apparently meeting all the requirements, being a single woman didn’t somehow enter into it.

    So I too have decided not to bother with banks. I look for great deals. Make your money on the front end. It can take a long time of constant searching to buy a property at 85-90% of ARV with a little lipstick, but buying with cash on my first investment property meant that I am pretty bulletproof for any recession. (spent K200k on a house worth approx $240K and getting good rent for over two years now.)

    I am now looking for my second investment property, and only have half the cash you have, and am making an offers on a properties approx. 1 - 1 1/2 hours from major cities. Sometimes I get outbid. Sometimes the seller takes it off the market not getting what they hoped. But time and patience and constant looking can be rewarded. I plan to buy and hold, and rent out. Why? Because by the time I have three properties I own outright rented out I will have enough income the banks will be dying to lend to me.

    Then I’ll just laugh at them, because I won’t need them.

    Good luck, and let me know if you do decide to partner up. I’d love to talk it over with you. Talking things over is a great process in and of itself, gets the creative juices flowing.

    1Reply
  • Courtney Buck
    Investor · Alpharetta GA and Destin, FL · Member since 2020 · 68 posts · 55 votes
    6y

    @Casey Roman

    Hi there, your cash is not worthless. The extra cash I had after I deployed, I invested in a syndication that pools money to purchase apartments. It's not a loan, you're actually purchasing part of a property as an equity stake holder. They did all the work and I got a check every quarter.

    0Reply
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