All Forum Posts by: Brandon Eleazer

@Sergio Altomare    temple university real estate courses @ 1515 Market street. Fall semester courses beginning next week.

@Precious Thompson are you studying to get your real estate sales license? I think that may help show you have an interest and could possibly become licensed to work with the company. What area(s) of real estate interest you? What kinds of companies are you sending your resume to?

@Account Closed so this investor would pay a one time fee and would receive periodic profit distributions? And yet not be required to contribute additional capital for expenses? It may appear to be an attractive proposition now, but what if your portfolio grows exponentially in a short time to say 30 units? Would you still feel comfortable giving away those shares of proceeds at that point?

Hey @Account Closed thanks for asking. We decided not to add a 3rd partner for two main reasons:

1. Too low/slow returns - We determined that after paying a mortgage, maintenance and other expenses, the monthly cash flow left over & split three ways is not attractive enough for all partners.

2. Different Goals - The 3rd partner was only looking to invest under the condition that we would take the funds from the cash out refi on this deal and invest them into another subsequent partnership deal. We did not agree on those terms because we wanted to utilize our portions of the cash out refi for other individual things.

I'm not sure if either of these two points are applicable to your situation, but I think it would be much easier to have all partners on board when initially purchasing the property, or try to negotiate to have the other partner act solely as a private lender vs. a partner.

What is your take on this and your situation?

Congrats on your first victory! Question: the subject says under contract so are you taking ownership of the property or just controlling it? And also are you recording the note? Thx

If your sellers want full retail value then it could be possible to pass the lead on to a Realtor to list for sale. This is of course if the sellers don't mind paying commissions and closing fees. The Realtor can't pay you a cash referral if you aren't licensed but you could ask for a gift card (and cash that in) Just one idea where everyone would benefit.

Where did the lead on this deal come from? A wholesaler? MLS?

Hi @Kira Santa 

Does the $37k include the Wholesalers fee? Is this the price you are planning to offer? Are you paying all closing costs or will the seller need to pay their own?

At a total acquisition cost of around $40k and $20k-25k in repairs there doesn't seem like enough profit margin for multiple partners. These are assumptions, but the holding costs (taxes, insurance, utilities, financing if applicable) over the next few months combined with the selling cost (commissions, transfer tax, seller assist if you're selling to FHA buyer in a lot of cases) you're looking at about 85% of your ARV left.

$90k x .85 = $76,500 - less repairs $25k= $51,000 - less acquisition $40k= $11k net profit.

Consider the remaining profit you'll receive once this profit is split between partners and after taxes.

I'm working on a similar deal right now and thinking that I will rent it out since the profit margin is only around $10k. But if your strategy is to flip (and go in with partners) I would try to buy this place for $30k. I think that it can be a challenge to find deals where the numbers make since in Philly. Let me know how you make out on this. I'd be interested if you have more deals as well.  Good luck!

@Geoffrey Rittenhouse the transfer tax is typically split with the seller. However in distressed situations and REO transactions the buyer may be required to pay the full transfer taxes of 4% of purchase price.

The seller is typically responsible for the U&O ($107 in Philly), but again in certain cases the buyer is responsible for this cost.

I would budget an additional $3,000 for title, homeowners insurance and other closing costs.

@Terry Hershberger I hope to be a very wise Millionaire RE investor one day as well. Thanks for the inspiration and words of wisdom!