All Forum Posts by: Andrew Bang

Houston Texas Investors Trip: It’s on again!

October 24-25th.

Get to know the Houston Real Estate Market and establish your Flipping Team!

Houston is one of the hottest markets for fix and flips. An abundance of properties with incredible appreciation potential in one of America’s fastest growing cities. Great price points in A, B, and C class neighborhoods. We’ve established relationships with contractors, wholesalers, title company, Realtors, Insurance agents, and interior designers. Join us on the tour as we visit off market properties, in progress rehabs, and completed homes on the market.

Boomerang Capital is renting a tour bus and providing lunch. Seats are limited to 25 people.  Need to RSVP.

Tour starts Thursday, Oct 24th, at 9:00am.

Funding is available and pre approved for every home we visit by Boomerang Capital. By attending you will be able to establish a relationship with Boomerang Capital and can be pre approved for future flips.

If interested email or call Andrew Bang, seats are limited, (the tour bus has 25 seats). We are looking for out of town experienced investors who are interested in flipping in Houston and are ready to start from day one.

There is no Cost for the tour. You just need to get to Houston and book your hotel. The tour will be leaving and dropping off at the Sheraton Brookhollow Hotel.

Great opportunity to network with like minded investors from all over the United States. Last tour we had investors from California, Arizona, Utah, Colorado, Georgia, Ohio, and Florida.

For those that arrive Wednesday, we will be meeting up for drinks and tacos at Torchy’s Tacos. For those staying Thursday evening we are planning another dinner and drinks at Dave and Busters, both sponsored by Boomerang Capital. On Friday, wholesalers will be available to drive investors around to additional properties.

Thank you!

I have an out of the box idea, its an approach to financing flips/rentals while creating passive income. Still working out the details.

Collateral assignment of life insurance has been around for a while, where a bank/lender uses a life insurance policy as collateral for a loan. Lenders love this due to the guarantee of funds if the borrower dies or defaults.

When flipping homes I’m not generating any passive income, all my money is tied up in the properties I’m flipping. If Hard money covers 85% of the purchase/rehab, after 3-4 homes I have over 100k of my own capital tied up in these deals waiting for one to close.

I keep thinking this is a problem, I need to think of it as an opportunity, debt can be an asset. Hard money lenders want to provide fix and flip loans, but they also need investors to invest in their fund to be able to provide the capital for the fix and flip loans. These funds generate passive income for their investors.

This is where a collateral assignment could work. Instead of using my funds to fill the gap for my hard money loans, what if I took that same 100k and invested it in their fund, then used that investment as a collateral assignment to fill the gap.

I would be earning steady passive income as one of their investors, meanwhile they are providing me 100% financing on my flips (purchase and rehab).

*** Taking it to the next level: What if I used my collateral assignment to JV deals. An investment friend has a great deal but needs gap funding, I guarantee his loan with my collateral, he receives 100% financing, I receive a portion of his profit when he sells. I'm now receiving three incomes from my one investment.

• 1. Investment in fund (11-12.5% annual return) (typical return from a well-run fund)
• 2. My own flips 100% of profit
• 3. JV profit share 10%-50% of profit, depending on agreement

***Taking it to one more level: I don't flip any properties myself anymore, I'd rather play golf. Instead I max out my collateral just being a JV on multiple properties. Collateral isn't based on one-to-one, I can use it four to six times the amount I initially invested.

• 1. Investment in fund (11-12.5% annual return).
• 2. JV on 4-6 deals, share of profit in 4-6 deals.

Thoughts?

If I found a fund that would do this, would you be interested? Contact me, let’s have lunch or play golf. I split my time between Arizona and Texas.

@Ian Henley, I can fund 85% of the purchase price and the rehab.   12% interest with only 1 point.  No fees.  Best part:   I don't do appraisals, which means I can fund next day when needed.  For the rehab draws, no 3rd party inspector to argue about the work, send me pics and invoices and I'll send the money to your bank account.   

-No prepayment penalties or minimum hold times

-Only pay interest on rehab draws that you have taken

If you would like to see how the numbers breakdown, email me an address, purchase price, and your rehab estimate and I'll send you a loan estimate.    Thanks!

Houston Investors Trip - Sponsored by Boomerang Capital (Hard Money Lender)   :    Thursday, April 25th.

No Cost for the event, Lunch provided.  For out of State Investors.  Limited spots available - Once the tour bus is filled.  

The goal is to Network with active Houston investors  to create a team for out of state flippers and investors. 

Agenda:  Starting at 9am 

Property tours, available off market properties, wholesalers and contractors on site to answer questions and talk about the market and comps. 

Lunch:   Title company, Attorney, and Insurance agent presentations

Property tours, different properties, different wholesalers and investors to promote their properties, Realtor, and contractors to promote their services and show their quality of finished work, answer questions, and network.

Tour Ends around 4pm.

Great opportunity to learn about the Houston market, meet active investors, and establish a team, (boots on the ground), to assist in purchasing off market properties in Houston, for fix and flip or buy and hold.   

Boomerang Capital is sponsoring the event and offers amazing terms/rates for Houston investors.  

Please email [email protected] if interested in attending and for more information.

Thanks!

I've found Chase bank is great for LLC's, if you open a business account with them, they help you form the LLC. They have all the forms and the reps have been trained to know where to file.

Yes, most hard money lenders will still fund your deal if there are tenants still in the property.   Just add the time it takes to evict or give the tenants notice to vacate as part of your hold time.   

Ask specific questions about their process for getting a loan approval, underwriting, and property valuation.

-Do they pull credit

-Do they get an appraisal on every property

-Is underwriting in house

-Is the money in house

How many people will review your information before you get a loan approval?

If they are getting an appraisal and pulling your credit, it will be difficult to close in under 2 weeks and you will be paying points + fees. You are paying a high interest rate for Hard money, find a hard money lender/private money lender that makes the process easy and able to fund quickly. Find a hard money lender that is truly “asset-based”, they won’t have an issue closing in 2-3 days. They will give you a loan estimate with any points/fees laid out within minutes of you talking to them.

Good luck!

I would look at local Real Estate investment groups, attend a meeting and you'll find investors, wholesalers, hard money lenders, all that have knowledge and can help you get started.

If you call up a mortgage broker they will ask some basic questions  amounting to: "What is your capital position right now?"   What is your credit, how much money do you have in the bank, how much income do you produce.

There are many creative ways to buy investment properties that are not dependent on your credit score or income.   Finding out how takes initiative on your part.   Your post is a good first step.    Good luck!

Investment Info:

Single-family residence fix & flip investment in Chandler.

Purchase price: $145,000

Cash invested: $9,000

Sale price: $158,000

2009, My first loss. I cut too many corners trying to save money, went with the cheapest contractor (quality of work was poor). Instead of granite, saved a few hundred and did granit-crete. Kept the beige/pink tile because it was in good shape. Looked horrible. Add a weird floorplan, small backyard, and a noisy neighbor that was always outside when a buyer would walk thru equals NO PROFIT.

What made you interested in investing in this type of deal?

The numbers looked good on it. Even though I didn't care for the neighborhood, the curb appeal, or the layout. I trusted the numbers.

How did you find this deal and how did you negotiate it?

Trustee auction

How did you finance this deal?

cash

How did you add value to the deal?

I added cheap upgrades, cheapest I could find.

What was the outcome?

I lost money on the deal. I still look back on this deal and laugh, especially with the granit-crete countertops, they looked so bad, if you were to set a hot pan on them they would melt.

Lessons learned? Challenges?

Buying right is most important, but there are other factors at play. When you cut corners buyers can tell. Choosing the right contractor, ask for pictures of past work and references, actually call the references.

@Faustina Deguzman

Welcome to the valley! What kind of investments are you looking to get into? I can recommend some good wholesalers and investor friendly brokers, I’ll send you a DM.