All Forum Posts by: Andrew Michael

@Winston Cummings Not sure what your intention with the money is but there are many hard money lenders that may work for your scenario and prefer non-owner occupied properties.  There are also line of credit type options that may work for you.  Not portfolio loans per se but can achieve the same desired outcome depending.  

How long do you need the money for, this may effect your options.

@Garrett PItts I have a few units up there and use Ridgecrest property management.  So far I have been very very happy with them.

@Dominic Courtney spot on observation.  Economy is ok right now but I would not want to be caught holding property up there during a 2008 type pull back unless you are in it for the long haul.  The government up there also makes it hard on landlords.  A weak economy making it hard for people to do business is the wrong recipe in my opinion.  It would appear there may be a slight shift happening up there but Hagerstown is still more or less a blemish to MD city list's.  

@Ken Nyczaj That being said, I would still throw some dollars at the social media thing.  Not sure it directly relates but there may some parallels here.  I started my IG about 1 month ago.  I made sure to build my page up a bit and got a decent following.  Tonight, I just crossed over 500 followers and have only run two sponsored ads in that time.  So far I have 4 qualified wholesale leads and 3 hard money loan leads. 

I'm on day one of my promoted ads, have spent a few hours a day building my page and crushing DM's for 7 leads.  Nothing crazy but I'd say a good start.  I think once I get to 5k follower if I put just a few hundred a week into it, it will become a huge lead gen.  Its certainly a lot of time and effort but so far it seems to be working.  Check out my page and you can see what I've done (link in bio).

Now my twitter, I cannot get any momentum.  So far a massive waste of time haha.

@Ken Nyczaj thats a great point and your right per your target market.  A lot of my leads now are "wholesalers" or essentially bird-doggers who work their immediate sphere of influence but have no idea how to process a deal let alone close it out.  So for me the social media is great cause they bring what they have to me and I close it out.  

My last few direct mail campaigns have been terrible however I did land a massive development deal so that kinda skewed the results.  Still, I have been on the Gary V train lately and putting ridiculous effort into my social media farming.  The leads are starting to come in, time will tell if this fairs better than direct mail.  My thought is add space on FB, IG, twitter, etc is still cheap and reaches so many more people.  With $2000 dollars worth of  adds you could realistically touch thousands upon thousands more than putting that money into mail.  

Just my theory and thought anyway.  I know the big guys still rely heavily on direct mail so take it a face value.

Hi @James Nelson,

Do you own the rental in your name or in some sort of entity?  Most lenders main concern will be the as is value in relation to how much money you need.  On the hard money side at least, typical for this area is 65%-75% for cash out and 70%-80% non cash out.  They will likely also want copies or leases, info on tenants and an assignment of rents as protection.  What you are doing with the money and your exit strategy will also be taken into consideration.  

Hope this helps.

Hey @Justin Saunders what are the goals of the group and are they all brand new to real estate or just new to wholesaling?  I ask because an hour will hardly scratch the surface.  Though proposed as an easy intro into real estate wholesaling is very difficult.  Easy in theory difficult to execute.  I would venture to say 99% of the people who set out to wholesale never complete a single deal.  

Lets chat sometime this weekend.  Please shoot me a private message.  

@Sean Fuller These numbers actually work for a 90% funding scenario.  A few points to bring up.  If $25k is the absolute max you can contribute to this deal then I would say you are slightly under capitalized to move forward.  Keep in mind you will have carrying costs as well as unexpected costs throughout the project.  I would like to see you have an additional 8-10k as a "safety net".  

Also as @Ned Carey pointed out most lenders have a reimbursement style draw.  The main point is that they want to ensure the money that is being released is being put into the project and not for personal use.  I typically like to put my people slightly ahead after draw 1 so as long as you are showing progress with the project that shouldn't be an issue.  Things like ordering the dumpster, doing demo, getting materials on site, etc are things you could potentially do yourself and possibly afford you the ability to get out ahead of your draws so you do not feel as much pressure coming out of your pocket.  

I sent you a message, shoot me a call if you have any questions.

I cannot speak for your mentor but solar panels have become a huge pain point in the transactions I have been a part of.  I have seen them cloud title and delay closings quite a bit.  Furthermore not every home owner wants to deal with them so you are narrowing down your buying pool.  I also thought the breakeven for solar was roughly 25 years or so but I could be wrong on that.

@George Ozoude

This depends on many many factors.  First, it depends how much capital you have on hand, how big of projects you want to take on and how much volume you intend to do.  

If you only plan to do one flip at a time and have enough money to fund your own acquisition, rehab and project soft costs then it may makes sense for you to save on fees and fund the project yourself.  Keep in mind however this is putting 100% of your cash at risk.  If you want to leverage your capital, leverage your risk and do more volume then hard money may be the way to go.  

Many people use hard money because a good lender can act as a second set of eyes on your project and be a great asset to you throughout the process.  That being said a bad lender can cause more harm than good as well.  

You will have to weigh out your strategy and see what makes the most since for your situation.  Cost of capital will also be a driving factor so I would recommend taking time and vetting local lenders until you find someone that resonates with you and your goals.