REI is not all sunshine and roses

5 Replies

Investment Info:

Single-family residence private money loan investment in Roanoke.

Purchase price: $58,000

UPDATE(8/15/19): Deal fell through. The property already had another Lein that was not disclosed during the foreclosure auction. Being unable to secure a clean title meant that I would not be the 1st lein holder to get paid back. Unfortunately, the rehabber who did the bidding lost his earnest money, but there are more in the pipeline.

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First private money deal in works! All photos are various stages of "before" from inhabited... to vacant... and then foreclosed.

What made you interested in investing in this type of deal?

I am looking for the most passive way to invest in real estate and, through a Bigger Pockets contact, found a rehabber that needed small amounts of additional capital.

How did you find this deal and how did you negotiate it?

The rehabber went to the foreclosure auction at the courthouse steps.

How did you finance this deal?

I'm the private money lender, and I use a self-directed ROTH IRA to fund real estate deals.

What was the outcome?

Deal fell through B-(... But looking for the next one now

Best of luck to you! Can You DM me the address of the property? The picture looks very familiar. Thanks for sharing both sides of real estate investing.  

Originally posted by @Brandon R.:

Best of luck to you! Can You DM me the address of the property? The picture looks very familiar. Thanks for sharing both sides of real estate investing.  

Do/Did you invest in VA?

Originally posted by @Jeff Kao :

@Greg Moran Thanks for sharing a valuable learning experience. Do you think there's any way of avoiding this issue in the future? 

@Jeff, Considering I lost no money on this deal, and kept all relationships positive... I'm not sure what there is to "avoid". It absolutely was a learning experience but I would not do anything differently next time. I've talked with the rehabber, Jack, who bid on the foreclosed property at auction, and even he said there was no way to know ahead of time.  The courthouse steps is a higher-risk situation where you can absolutely loose if you aren't able to close in time (usually within 2 weeks). Not a place for beginning investors like me to play in.  But Jack has made his career out of it, so I was relying on his experience.

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