All Forum Posts by: Arpan Patel

I think any good time is a good time to buy. You just need to make sure you figure out what model works best for you and the market you are in and attack that. No matter the market, there will be a way to make money. What strategy were most of the people in your REA meeting utilizing? 

Agreed with john, "Looking back, what advice would you have given yourself when you were just starting off? What strategy would you advise yourself to start off with first." I like those kinds of questions because not only do you get to see how they started off but you get to hear how they would have changed that and most importantly the logic behind it. You can also go the other route of, "What has been most lucrative for you and do you think we would go down that route first?"

@John Mathewsonundefined

@Jeff Lezark: Agreed, I should have mentioned it. Good catch

@Jeff Lezark: Agreed it is a risk but how often does a performing note get called due? There have been some epic threads on BP over the years on this very topic so in an attempt to not recreate it let's just agree that it is a risk and the bank has every right to call it due. If one is willing to take the risk, please do so with eye wide open. Personally, I would take that risk but that is my personal choice; others run their business differently.

Okay so let's take this point by point:

1) I would suggest you get an entity. Consult an Attorney and CPA to find out the best fit. We use a Series LLC but that concept does not exist in NY. Best to get an operating agreement as well which clarifies who is responsible for what, what are the terms of dissolution, and other necessary items in case something unforeseen comes up.

2) Yes and No. FHA will only (in the residential world) lend to a person but people have bought in a personal name and then transferred the property to an LLC with a quit claim deed or something of the like.

3) There are many options and combinations but here is a short list of them: Your cash, your groups collective cash, mortgages in your personal name(s), conventional financing, family and friends, retirement accounts, life insurance,  private money lenders, hard money lenders, partners, etc.

4) I have had 3 partners before (i've had 5 at one point) and every situation is different. As long as everyone does what they need to do to keep the business forward it can work for a collective vision. 

5a) Don't know

5b) The MLS only for now (yes it can be done) and that is where I recommend people start because the other methods can involve some capital and I like free to start with.

5c) You can always to a title agent. In some states and attorney will also be able to help. Lastly, sometimes public records are on a county assessor or treasurer's website. They sometimes call it a document search if you'd like to take a look yourself. I do that all the time just to see.

5d) It's called Note buying where you purchase the note on a house and there are many exit strategies. I haven't done it and there are many on bigger pockets who that is their primary investment vehicle. There are also many blog articles on that subject matter as well.

I hope that helped! Good luck!

Have you tried your local REIA? There are some wonderful contact you can make by networking there. Maybe first try and identify them in your market and then see what value you can offer them as you learn from them. Good luck!!

There is a lot baked into that question and scope is rather large. If I understanding correctly, you want a bit of advice on what to offer and also how to evaluate the rehab. Assuming that is correct, each of those questions has quite a bit of an explanation but I'll try to boil it down as best I can. Step by steps can be found on other places and books such as the books found in the bookstore on BP. As for how to determine the offer price, I'd first figure out what strategy you are going to use on the house. Then figure out if this property can fit that criteria. Then I'd get some feedback about how the home with will worth when repairs are finished (I know, bit of a chicken or egg scenario). After that you can plug those numbers in the BP calculators (chose the appropriate one based on your strategy) and then see the results. Then work the number until you are comfortable with the inputs. Don't twist your numbers to just make a deal work though!! 

As far as the rehab questions, there is a book about estimating repair numbers in the bookstore on BP. That should give you a guide on what to look for and a relative idea on what those services can cost.

I hope that was helpful but my sincerest opinion is there is still a fair bit of research that still has yet to be done before you jump in head first. (Maybe not the opinion you were looking for but please be careful if you don't want to research further)

@Mark Robertson: I stand corrected. I thought the model was purely lender and not syndication. In that case then yes the higher returns make sense. I still don't like the idea for the other reasons mentioned however I stand corrected. However there are also many crowdfunding sources that do not offer equity sharing so it is something to look out for. One of my current lenders for my flips is a crowdfunding source and based on their short term products their investments would not qualify for capital gains.

Depends on the services and your state. Here in IL we use attorney to close a property and the usual charge is about 500. We also use them to draft operating agreements (usually about 1k) and sometimes to contect taxes (1/3 of the first years tax savings if there is any savings). Some people use them to also incorporate but we don't and lastly for other documents depends on their time. Evictions are another big area but we only rent in Indiana so about 500 is about right for that as well. Other than that, not sure but then again PA might have some rules I am not aware of that you need an attorney for and the prices I gave work for Chicago and Northwest Indiana. Not sure if they are applicable to you but it gives you a good base to work from. Hope this helps

One way of checking if they are for real is get some other property they have lent on and research that property. Find the owner who they lent to and give them a call and see how the process went for them. Basically, it is like checking up on referrals. A lot of private people who lend may not have a website. The important thing is to see if they are serious and have done transactions before. My private lenders turn out as expected because I set the tone of the business relationship and walk them through how to lend to me. I manage the process front to back so it goes much more smoothly. So I say just check on their referrals and if you can find title agents who have worked with them before that could give you some insight as well. I use Fidelity National Title and they are a good agency so I just put the word out with my reps and closing agents and see if they have worked with them before or if someone in the company has and I'd go with that. I hope that helps