Talk about a time you dug yourself out a hole?
Rental Property Investor 路 Harrisburg, PA 路 Member since 2017 路 48 posts 路 11 votes
Talk about a time you dug yourself out a hole?
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Rental Property Investor 路 East Wenatchee, WA 路 Member since 2014 路 10k+ posts 路 16k+ votes
5yOriginally posted by @James Luciano:
I like to always learn from the mistakes of others and my own, so I thought I would ask the community to talk about a time you dug yourself out a hole?
Right when covid hit, I was re-purposing a large SFR into a sober living home. Adding 3 bedrooms, a kitchenette, half bath and hobby room. All stopped at city permitting, subs, etc.
I was stuck with a house down to the studs with new framing. Couldn't place new residents even if I had finished. But at least I had a nice $1850/mo outflow of debt service and fixed expenses. Thankfully I have a 5 yr private momey mortgage and not a HML.
I stopped digging when I found out a contractor friend needed a house for himself. I offered it to him as a lease with option to buy at a fair price if he finished the work. He has the basement rented out now and is at least paying the $1850/mo.
I'm out my dp, rehab costs, time and indigestion ($58k and 3 months) for now. I will get it back we he buys, but the work and bleeding has for now stopped and I am outta the hole馃憤
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- Investor 路 Thermopolis, WY 路 Member since 2012 路 4k+ posts 路 4k+ votes5y
@James Luciano, hmm since I was mentioned I will tell you about the hole I dug myself out of. My hole was ignorance. I had moved into a really bad trailer house that my dad had gotten behind on payments on. I had a very little bit of money to give him and catch the payments up. I was in college making very little on the side as a night watchman at a power plant, and opening a gas station from 6 a.m. to 8 a.m. then off to college to be 5 minutes late for class every day. I knew nothing about fixing it up. My girlfriend moved in and we got married. The windows were crank up windows but the cranks were broke so when the wind blew the windows would sometimes wave open letting the bitter wyoming winter inside. So I duct taped the windows closed. I put straw bales over top of the sewer line that ran out the side of the skirting because it kept freezing shut. Eventually I was ready to move to the university in Wyoming and I tried to spruce it up a little. I found a place that sold trailer house parts and found new cranks for the windows so they worked right. I built a little box over the sewer line and fixed up doors and other items. So after living in it completely messed up I fixed it up the last month I lived in it. I sold that trailer for enough to make a down payment on small trailer and piece of land a few miles from Laramie. The owner of the land carried the contract at 10% inter4est the trailer a bank loaned me money on at 14% interest. We heated it with candles and a coleman lantern until I got a ditch dug for the power company to lay the power cable in. Then we rented a propane tank to heat it with but had an electric blower on the furnace. We hauled water until I found a well driller who would take payments for drilling a well. We couldn't drink the water but we could finally wash clothes at home and not a laundromat. I worked at a service station after school until closing and painted houses, roto tilled gardens, etc. on weekends, or in cold weather I shoveled snow when I could. When I moved a friend helped me rent it out. The t4enants were awful, only paid rent about every other month, had a pile of cats in it, and I eventually had to buy propane for them to keep them from freezing up the pipes. I evicted them, it took forever, and I cleaned it up a little and sold it through a realtor.
So my ignorance had me not fixing a trailer up for 3 years until I moved out, not knowing anything about renting and getting bad tenants, doing no background check at all, and paying a commission to sell it.
There is a happy ending. Wyoming was in a horrible recession so I was able to buy a house dirt cheap where I moved to next. It was a foreclosure and inbetween 2 other foreclosures. However when I sold that trailer house in Laramie, I took the check from it and marched down and paid off that house. Real estate can be very forgiving of ignorance. Looking back I made dozens of pretty dumb mistakes, but time fixed them and I survived and even thrived. Now learning more about real estate has allowed me to move out of the house I paid off over 25 years ago, and buy my wife a very nice house she really wanted. Most holes you get yourself into are from ignorance. The way you dig yourself out is usually hard work and educating yourself, and maybe a little bit of luck and forgiveness.
There should be a moral to these stories, mine is work hard, educate yourself, and accept and give forgiveness. Merry Christmas.
- Real Estate Broker 路 Cody, WY 路 Member since 2010 路 28k+ posts 路 41k+ votes5y
Great story, Jerry! How will our future generations survive having never faced difficulties the way we did? I know what it's like to have no money, no education, coming from a family that had only known poverty for several generations, etc. None of it really matters. I tried to work hard, be honest, and give my best effort. At some point I realized I had more value and potential than I had thought. I took the risk and moved in a new direction. I made mistakes, corrected, and tried again. I'm 51 and can finally say I'm financially independent and capable of retiring early, though I doubt I ever will.
Real estate is forgiving. Life is forgiving. Do your best, keep challenging yourself, and success will come your way.
And remember, success comes in many forms, not just in the number of properties you own or the dollars in your account.
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