All Forum Posts by: Aaron W.

@Carl Flint There really is not a list of justification. It really can be for any reason. However, if you have a 10 day inspection contingency and don't do an inspection, it may look a little strange but not out of the question. There are infinite reasons why someone backs out of the property. You really should go into a deal with the intention of successfully closing on it with the seller, whether it is you buying it, flipping it, or wholesaling it. 

If someone backs out of too many deals for no real reason, then a reputation MAY form that they do not close and  brokers and sellers may start to disregard their offers.

Best of luck!

@Suja N. You've made it this far, I would not give up. I understand there may be potential issues, but what if there aren't?  If there are, then it could make sense to bring on a partner to see this deal through. 

Best of luck!

@Faustin Hoover You will typically will not have a credit card on file for the tenant and can't charge the amount to them. You will collect a security deposit prior to the tenant moving in. You can deduct any repairs or cleaning fees needed from the deposit. If it goes above the deposit, then you can bill the tenant for the excess. If they do not pay, then it is a matter of seeing if it's worth taking them to court for damages or just eating the cost and taking it as a loss. Insurance can kick in for any large repairs that are needed.

This is why tenant screening is extremely important in owning rental properties. Although, this will not fully solve the issue, it does make a huge difference when you screen for the right tenants.

Best of luck!

@Carl Flint You are correct, with a 10 day inspection contingency, what that means is you have 10 days to complete your inspection and can back out of the deal with no repercussions. You don't have to provide a reason for backing out, but most of the time a reason will be provided. 

Best of luck!

@Joe S. Yes, I have asked my PMs to provide the tenant lease agreement for our review. I have not had a PM company push back on this as I explain we want to review it so we know what the tenants are agreeing to. We explain we will not use it for any other purpose. 

Many times the PM agreements can slant to favor the PM company since they pay for the creation of the agreement. You can try to negotiate terms with them. Some will agree if they are reasonable, but some will not.

Best of luck!

@Jonathan Leal The type of financing will depend on what rehab needs to be done to the property. There should be some favorable residential loan options since you will live there.

Best of luck!

@Anthony Surach Both are possible starting out, it all depends on the type of property. You will need to ensure you have an investing criteria for renting and flips. The general thinking is what you can rent, you flip; and what you can't flip, you wholesale. 

Before starting out, know your "why" in investing in real estate and establish goals to accomplish the "why". 

Best of luck!

@Ryan Jones Depending on what and how you are investing, your year 1 returns on a property may be negative or not reach your investment criteria.  For example, a moderate to heavy value add project may take a year or two complete, so you will have low to negative returns during this time.

This is okay as long as your stabilized returns and ARV are where they need to be. Take a long term view of a property. Too many times, the results of the real estate calculators will only focus on the year 1 returns of your property.

Best of luck!

Does the CMA include properties that have similar bed/baths, layout, year built, etc.?

At a certain point, you may need to make educated guesses at what the potential ARV is based upon the CMA and what similar properties are valued at.

Best of luck!

@Tyson Thurman You are not required to use an agent to buy real estate. You could submit your own offers, but an agent will be able to streamline the process. If you do decide go on your own, then I'd have a good real estate attorney in the market you plan to purchase the property to ensure all the agreements are legal and binding. 

The pros of not using a real estate agent is being more in control of the process and communication. You can potentially save the seller some closing costs, which could be a selling point. 

The con of not using a real estate agent is you have to make sure you're hitting all the milestones written in the contract, such as inspection timelines, etc. Missing anything written in the contract could potentially nix the deal.

As a buyer, it costs you nothing and is a valuable member of your team.

Best of luck!