All Forum Posts by: Alexander Ball

From what I've read (which is important because I am a newbie myself) it may not be ideal for your first property to be purchased and managed remotely.  There are a not of nuances to this business and without eyes and ears on the ground to help you when you are gone -- you may not be as successful as you could be.

With an FHA loan you could get away with just 3.5% down -- that still buys you a lot of house.

Also, if you wanted to save more money you can start off by househacking even when you're renting.   Lease a house, sublet out the rooms to friends or people you'd be okay living with, and live for free or cheap!  Sleep on the couch, rent out your room, and you are now MAKING money for living in an apartment.

Good luck!  I'm just getting started myself and I'm 10 years your senior.  You'll do fine if you are persistent and careful.

Past self: maybe don't spend 60k on a liberal arts degree that you use in only the most tangential way. That could be a property free and clear! Real estate related: research and reading and learning is important but it does not equal action.

BTW: I have called two contractors this afternoon, and I'm shooting for 3 estimates.  Thanks for helping to make sure I'm not playing catch up when the time comes!

@Jesse 

@Jesse Vipond

The rental multiplier is another way to think about the 2% rule, correct?  If it hits the two percent rule it has a rental multiplier of 50 or less.  A 1% deal is a rental multiplier of 100.   

I really appreciate your detailed response.

I tried very hard to be forthright with her in my discussion and frame it as a way for us to both help each other.  She wants out, I want in!  I also told her that another person might be able to offer cash, but that because she is not desperate to get out and I can do a 203k loan she doesn't have to worry about getting the property pretty, taking pictures, paying a steep discount.

I honestly want what is best for both of us -- and I hope that I can find a way for the numbers to work for me while also helping her out.

As an aside: I believe she will need to go to probate court still, to get the deed out of her deceased father's name.  Is this a very long process that will drag out into perpetuity?  She does have 1 sibling, but I imagine (hope, really) that there won't be fighting over who gets the property.

Thank you, again, Jesse Vipond.  I truly appreciate your time and expertise.  

Hi Bigger Pockets Pro Forum,

This is my first foray into posting in the pro forum, signing up after being energized by a couple catalyzing changes in my personal life.  I have a penchant for being verbose, so I will do my darnedest to keep this short; I want your help and I need you to get to the bottom of this post to help me.

I drove for dollars a few weeks ago. Actually, I walked with my dog for dollars, and wrote down a list of properties that had either deferred maintenance, looked vacant, or had FSBO or hand made For Rent Signs. I did property/parcel lookup for them and did my best to find phone numbers of actual people.

This particular property was owned by someone whos number was listed to a tax company, I called the tax company and was told that the gentleman on the record had passed away and he bought his business 3 years ago.  I looked up an obituary.  I found the wifes name.  I called HER.  She gave me the step-daughter's name and number who is actually the owner of the house.  This alone felt like a minor victory -- I felt like a detective!

I called the owner last Friday and left a message for her.  She called be back last night at 10pm and left a message when I was sleeping.  I was terrified -- this is real!  I called her back just now and learned the following:

The property was her fathers.  It has 3 apartments, 1 of which is vacant and having work done, the other two have long term tenants.  She doesn't know how mucht the house is worth.  She knows she has wanted to sell for a while, but she is busy and has had a hard time getting work done on the house that it needs.  She will be at the property this Saturday and invited me to come and look at it.

I have a buyers agent, and I emailed her just now telling her what I've told you.  The property owner said she doesn't know what the next steps are, and I told her generally what they would look like, but I am a little lost and afraid I'm in over my head.  She said she has a real estate agent friend she wants to talk to about this.

I believe I have a good rapport with the owner. I told her I'm not a pro, that I just love the property and the location and due to the exterior condition of the house it looked like it was vacant. She was very wiling to speak about the house and was pleasant about it. I did my best to listen. She is a wife, has two kids, and is busy working professional who was not planning on being a landlord. She rents one unit out to a gentleman who has been there for years at a steep discount, who doesnt ask for anything and helps with snow and lawn maintance. She is not making as much money as she could, and it seems like she is only getting work done on the vacant unit when she has time on the weekends and it has been vacant for a while.

She doesn't seem desperate to sell, which is a good thing. I don't have to compete with people who can pay Cash, I will be doing an FHA 203K loan to finance the house. How do I ensure this turns into a "deal"? What would you do?

P.S.  What is the quitter about cross-posting this in the non-pro forums?  Should I have just done that in the first place since I am a PRO in name only and have 0 deals under my belt?

Hello all,

As the subject states, I'm interested in checking out some properties in the Ann Arbor, Michigan and Ypsilanti, Michigan area.  Duplex, Triplex, Quadplex.  Rehab is okay.

Caveat: I can not purchase with cash and I am looking for a seller willing to work with my FHA financing. If rehab is needed I can roll it into a 203k FHA loan, so that is okay.

This is my first Pro post -- please let me know if I am violating any policies for posting in the marketplace or any other general faux pas.

So the property was listed at 205, and then it came off market? And you saw that it was previously listed at 205k from your MLS access and approached the seller when it was off market?

Sounds great.  I'm looking at 4 on-market duplexs tomorrow.  I hope my buyer's agent doesn't shoot me when I tell her what I'd offer on them.  I'm hoping 10-15 offers means I get one deal.

Hi Edward. Did you use any of the "rules" when analyzing your property? It doesn't look like you make the 50% rule. What's your cash on cash look like? I'm really struggling trying to find a property that is a deal. Did you find this property on the MLS? You said you became an agent, but you also said you had a buyers agent. I'd love to hear back from you. Congrats on the purchase.

What did you do to ensure there wasn't a second or third mortgage on the house, Or other liens? Did you ask the title company to do that? How does that work?

Hi Justin, It seems like the near consensus around here is that it is better to spend other people's money. You don't want to fall into the trap of paying for cash flow. That means, don't put more of a down payment down so that you have a lower mortgage. Assume 100% financing when purchasing an investment and if I cash flows while still be conservative you might have a deal. Take this with a grain of salt, I've still only purchased one place so far -- my primary residence. But it seems to be what people think.