All Forum Posts by: Alex Hobbs

Hi @Jason Jin welcome to Biggerpockets!!!

Hey @Ralph R. I did not miss the point. I know what your saying. Leverage is key to building wealth, scaling a business, and creating a self sufficient rental portfolio. What I am talking about is a bad deal, one deal. If over the life of the deal you spent 80k out of pocket and you own a 150k asset free and clear, you made money. Everything has bubbles and prices go up and down...inflation, appreciation, and depreciation do play a big part. The value of a C-D class property should not move much, unless the neighborhood changes. There are a ton of variables that can be thrown into the mix. Yes, you could of made way more if you leveraged yourself and yes, the income from other properties could reduce your out of pocket expenses but, that is going back to building a self sufficient rental portfolio. We are talking about A bad deal.

Yes, @Ralph R. you are right, that is my mistake... $46,000 in to a $150,000 property. 

Hi @Jade Igwebe

There is a ton of great information and people on the forums!! Writing this post and looking for a mentor are great first steps for success. There is a good bit of people on here from DMV area. Keep active and good luck!

I do not have a portfolio of 5MM and I am not as experienced as @Ben Leybovich or @Jay Hinrichs so take this with a grain of salt. I also would not follow this idea(yet lol). Your grandfather might of meant:let's just say.....you purchase a house for 150k...30 years at 4.5% your payment is $760. Let's say another $240 for taxes and insurance. Total PITI = $1,000. Let's go 10% PM, 10% cap ex, 10% vacancy, 10% maintenance. Total = $1,400 all said and done. Let's say rents are $1,300 per month and your expenses are $1,400(all said and done). You are paying $100/mo for that property out of pocket. Assuming your reserve funds plus an additional 10k out of pocket covers all major expenses/vacancy/updates over the 30 years, you only spent $60,400 on a $150,000 house. You still made $89,600 in year 31 when you sold for 150k. This is extremely speculative and risky but it proves that no deal is a "bad" deal. I typed this quickly on my phone and could of fudged some stuff. Please correct me if I am wrong. Equity appreciation over time. Paying into a buy and hold is in theory similar to paying into a 401k or savings account.

Welcome to BP @Neil Metzger . Congrats on getting the first flip knocked out! Hopefully it will be sold soon and your off to picking up rentals. Spend as much time as you can educating yourself on buying rentals, scaling your business, and areas. What you learn will today will set the tone for tomorrow.

@James Nguyen Start with your goals. Decide what would you like to achieve with owner finance. Think about who your target or buyer would be, what their reason for wanting owner finance is. Figure out what terms you would be happy with( DP, interests, balloon payment, length). Contact an attorney to draw up the paperwork and put the deal out there. A good attorney and title company will be able to help you figure out what needs to legally be done to get the deal to the table.

That is awesome @Account Closed !! Keep up the momentum.

Thanks for all of your help @Salvatore Lentini !!! Yes, there are a few areas in OH that are very "fruitful" so to speak. Lebron and the Cav's bring a ton of money to that city!