All Forum Posts by: Alec Saenz

Thank you for your reply! 

Wow so you're saying in order to even close on the deal and get into the house you have to provide more than 3.5? Could you explain more on the reasoning behind that? Is that just added stipulations added from the mortgagor due to the cost of reno being attached to the price?   

Hello BP!

Alright I have many questions about this potential deal! First I'll go through and just shoot the info and Analysis, this is my first analysis so I'm sure its rusty. 

This deal is for my Mother and would be her first Real Estate deal ever. Through the many months of me trying to motivate my mom to make a strong push to jump into REI she finally has jumped on it and I couldn't be more proud of her! My goal was to get into buy and hold and make my way up to commercial MF, etc etc, so when I would talk to her about REI she naturally was inclined to do the same. So one day she calls me about a deal she thinks she might have found.

3/2 walk in closet, tile and carpet, screened porch, 1992

1207 sq ft Bank owned asking 128,200 

Comps in the exact same neighborhood with same layout going for 169 -171

rent is going for around 1300 in the area. 

She doesn't mind living in it for at least a year before she sells because she wants to 

do some reno work. (wood floors, cabinets, appliances, paint, crown molding,)

she's on a month to month rent basis right now and this would be a first time home buy due to haven't purchasing a home in so long.

She has up to 6K downpayment if needed.

The thing is I have so many questions about this deal and I'm hoping if i can get some clarifications please!

Okay,  in terms of financing.. 0 down first time home buyer, can you do this with a Bank owned? 

can you do a FHA 3.5?

Can she do a 3.5 with a 203K with added reno costs with a bank owned? 

Doing some estimated numbers, adjusting with all three of those above and an average interest rate, at 30 years, it still doesn't cashflow much, HOA fees are at 880 quarterly. so its looking like a more of a flip kind of deal.

the listing was posted just a few days ago and when visiting the property with the REA she noticed what she thought was an investor taking photos. The only way I see she has an advantage over an investor Is if she decides to live in the property, she will get 30 days advance time to make an offer, but she doesn't want to move in until getting it renovated. Thats where I brought up the 203K to her. She can use 4.5K of her DP, keep the rest, reno the place, live in it for a year, then sell it, hoping it appreciates a little more, for around 170K?

any insight is much appreciated!!! Thanks for taking the time to read my post! 

Hey BP!! Ever since I have been listening and learning about all the amazing ways to begin a Real Estate Investing future I have began to notice things I would have never seen had I not began my path towards Real Estate investing, just driving the same route back from my work everyday I began to notice houses with for sale signs in the lawns, houses that have been renovated and houses next door that haven't, almost like the law of attraction if you will lol! kind of an interesting and exciting feeling because I feel I am becoming more aware just through listening and reading about Investing, its an amazing feeling none-the-less...

Anyhow on my way back from work one day I am observing the houses in my neighborhood and notice one that looks vacant, like grass-3-ft-tall-and-vines-growing-up the-sides-vacant.. When I saw the house I pulled over to the side and took a look around and it seems to be in a decent condition outside wise (roof looks fine just needs a pressure wash) maybe some new paint to spruce it up and some yard work, but other than that it looks decent.. Now it got me thinking..

What would my next step be to start investigating a little further? I remember Brandon from the BP podcast brought up white pages, tracing the house location and seeing if I can get ahold of the owner... Would that be my next step??

Any insight, tips, etc, on how to gather more info and make the next step would be of much help!!

Thank you in advance! 

 Lol New in the since of something I haven't read yet! 

 Thanks Tim! Im always on the look out for a new good book to read! 

 sounds great man! And yeah I love the idea of Cashflow! Being able to get up and decide you dont wnat to work for a year while you travel the world has always gave me such a rush of excitement, to acutally be free and not stuck on that 9 to 5 slave cycle where your life depends on a job you care nothing about. Then the whole idea of passing your wealth and knowledge down to your kids so they can take hat you have and grow it is the Icing on the cake! 

 Very very interesting and exciting to hear! Thank you for your input and kind words of encouragement! Now i've always wanted to know how to find or develop a good team for myself and build a connection of people whom I can go to for aid in certain things, like attourneys, contractors whom I can trust, etc, etc. Do you suggest just going around and speaking to some and get a feel for the ones I like!? then go from there? 

And as far as a investor allies, I've introduced my older brother to REI and he seems to be soaking up the info and loving it just as much as I am, He deffinitley seems interesting in getting into REI so should me and him develop a partnership or should I be finding a partnership with someone who has experience and then later introduce my brother to the mix? I believe a team is more beneficial in anything you do because of the ability to bounce Ideas off each other and discover certain things one wouldn't see on his own? Whats your Idea on that?

 Ok sound my plan sounds good?! and a quick question about using "good debt" by doing what you stated above, using debt to my advantage to aquire more properties, is that what they call "Over Leveraging?" Could I get myself into trouble if the  market decides to take a turn for the worst would I be essentially left without a paddle? or is that when you are way over 50-60%? 

Hello Everyone! This is my very first post on BiggerPockets and I have to say BP is AMAZING.  From the website layout and ease-of-use, to the many different avenues that constantly provide great information like the BP Podcast. BiggerPockets has literally changed my life! 

So on to the topic at hand. I've been thinking hard on what I want to have as the foundation of my REI portfolio and I've realized ever since I picked up my first REI book I wanted to genereate Cash Flow, Lots of it. I also know, a great vehicle for creating cashflow is an apartment building(s). Now I haven't done any REI as I am still in the stage of soaking up as much knowledge as I can. I am 20 years old and I'm realizing my biggest problem is capital, like How can I get enough capital to even begin working on that level. Even something like a 12 or 24 unit complex?

My Idea would be I start small, buy a property and rent for a couple years then 1031 into another larger property and repeat. Repeat until I have made my way high enough to be able to 1031 into an Apartment complex that produces tremendous cashflow. Then go and do the same process until I can get into another large Complex. 

Now basically what im looking for is feedback on my idea, like if thats even possible? Are there better plans to aquiring such size buildings like private investing? Are apartment complexes even the best vehicles for buidling that cashflow or should I go the route of eventually owning 26 houses free and clear like the success example Donis King from the book The Millionaire Real Estate Investor?  I've read many books and listened to just about every podcast on BPpodcast but I know the forums can provide a TREMENDOUS amount of knowledge and enlightenment! 

Thank you guys in advance for taking the time to read my post! Hope you guys can teach me something!