All Forum Posts by: Brenden Mitchum

Hey @Bradey Peavy

Good on you making the decision to take the leap into real estate. However, I'd recommend taking a step back. First, if you have next to no cash reserves, you should build these first. Having reserves is especially important now with so much uncertainty in the market. I am not saying that getting a deal with next to nothing out of pocket is impossible, but that does not mean you should buy a deal with a couple hundred bucks in your bank account.

Now, let's talk a bit about hard and private money. Many intermingle these terms but it does help to separate them for education purposes. So, let's say hard money is strictly from an experience hard money lender (hml), this could be someone who has made a business out of lending their own capital or it could be someone with access to a fund of investors. Either way, this is a professional lender who has experience lending on real estate deals. Oftentimes they will lend for a period of no more than 12 months at a high interest rate and are used to secure a property that would not qualify for traditional lending. You would use this loan for a flip or a BRRRR to get into the property and rehab it. Then, after renovating, you would either sell the property or refinance to pay off the hml. Most only really care about the deal so bring them a great deal in whatever format they prefer and you'll have no problem getting a loan from them. Keep in mind, you will still need at least 10% down.

Private lenders fall into two categories, accredited and non-accredited. Accredited is those super rich folks with high net worth (over $1mm) or high income ($200k/yr). Don't worry about these guys for now. Non-accredited investors are who you are most likely to run into as you get started. These would be friends, family members, coworkers; basically, people who may not have much capital or investment experience. As long as you have a prior relationship with said person, you can bring them deals to invest in. So if you plan on going this route you'll need to start reaching out to people in your circles and explain what you are doing. Put together some kind of pitch book with a sample deal and keep a list of everyone who would be interested in investing once you come across a deal. This is your best bet with little money, but keep in mind you need to know your stuff. The last thing you want to do is blow mom and dad's retirement on a bad deal. This is where reserves come into play.

Your final option here would be some kind of seller financing or subject-to deal. Search these topics here on BP if you are unfamiliar. 

Right now I highly recommend doing some more research and begin networking with hard money lenders and potential private investors.

If you have any questions or just want to chat, please message me anytime!

Hey @Mason Kimball

Unless this is a super hot property or you are OOS, you are probably over-thinking it. If you have a solid agent and the property does not need a ton of rehab it should be pretty straightforward. 

The most important things would be to check out the big ticket items like the roof, foundation, HVAC (furnace and outside unit), and hot water heater. So make sure you go into the crawl space if possible because often times this is where the furnace and h2o heater are, as well as a great place to look for signs of foundation issues. Take a picture of anything that you're unsure about; better yet take a short video of the entire property if it is unoccupied. 

Depending how slow you go through and how much you chat with the owner/agents it could take anywhere from 30 minutes to over an hour. If the owner is there, I would say the most important thing you can do is build rapport with him and ask him lots of questions about his experience with the property. 

If you had more time I'd say read the Book on Estimating Rehab Costs by J. Scott, but again if it's relatively turnkey then you should be fine. Bring in your inspector after you have it under contract (with a due diligence clause, of course). Don't stress too much though, just go out there and enjoy yourself! Even if it doesn't work out, there will always be another deal.

Please, feel free to message me anytime if you have other questions or just want to chat!

Hey @Kati Henry Ortiz

I have not used Hometap before but sounds like refi for people who can't qualify for bank refi. That "How it works" video did not at all explain how it works but I'm assuming they have an investor fund of some sort that they pull from to loan on the equity, likely at a much higher rate than a bank refi. 

If you do end up going with them or learning more about the program, please share your experience with us!

Hey @Carol Burns

Check out dealcheck.io. Their software allows you to input an ARV but you don't have to put in anything for the rehab line so this would essentially just be equity gained by buying at a discount.

Feel free to reach out anytime if you have other questions or just want to chat!

Hey @Jeremy Luster, welcome to the BP community!

You've come to the right place man. There are tons of ATL investors and real estate professionals on this site, and I'm sure a number of them will be following me with their welcomes. So you're off to the right start, man. Start chatting with some of these people and I'm sure they would be happy to share their knowledge and experiences with you. 

I have a number of wholesalers emailing me every day, but this does seem to have slowed down since coronavirus - likely due to the fact that flips and BRRRRs are riskier than usual right now. 

So my advice is to take this time to network like crazy and narrow in on your goals and your plan to reach these goals. Really map this stuff out so you know what you're looking for; this will keep you focused and on the path to those goals. 

Message me anytime if you have questions or just want to chat!

Hey @Jared Ortega, welcome to the BP community!

I agree with @Daniel A. - why choose one or the other when you can have both?

Yes, small MF is tough to come by in the Atlanta area but if you are somewhat flexible on location it definitely isn't impossible, especially now. Many of the investors that were scooping up small MF for cash are now sitting on the sidelines, leading to these properties sitting on the market longer than before. Some of these properties would not have even made it onto the market pre-corona. With a strong offer, you could easily snag one of these and have yourself both a primary residence and an investment property. If you buy right, you should be cash flowing nicely when you move out in a year or so. Then, you can rinse and repeat or just stay in that first house hack and start buying straight investment properties (or even start flipping). The options are pretty much endless. 

There are also quite a number of these SFHs with finished basement mother-in-law suites so jumping on one of those is not a bad idea either. You really do have a number of options here so I would say choose your area and look for both SFHs with in-law suites and small MF. 

Please, feel free to shoot me a message anytime if you have questions or just want to chat!

Hey @Jalon Wilson, welcome to the BP community!

Nice to see a fellow transfer from Socal in the Atlanta area! Starting in REI with some BRRRRs is a great idea, man. This will allow you to quickly build a portfolio of investment properties. My best advice to you is to network like crazy. Find a killer REALTOR®, some solid wholesalers, and a great GC. They will be the backbone of your BRRRR team. Other than that, just keep educating yourself and stay active here on BP - tons of smart/experienced investors on here with great advice.

Please, feel free to reach out to me anytime if you have questions or just want to chat about the Atlanta market!

@Shyam Panchal

Glad to help! Yes, please reach out anytime.

Hey @Joseph Vu

Congrats on saving up enough to start the journey, man! Also, nice job doing your research to narrow in on two solid markets. Posting here on BP first was a good call. You will find tons of local investors and pros in these markets right here. 

While I cannot speak much to Indy, except that I frequently see fellow BPers praising the city for its solid cash flow, I can speak to the Atlanta market. With job growth that has been outpacing population growth (at least pre-covid), our city and the greater MSA is a very solid market. In fact, this is no secret as you will soon find out investing here. It is a hot and competitive market. While the pandemic has cooled things off a bit, our housing market has actually remained incredibly strong, unlike most other cities. This presents a unique opportunity with many investors opting to press the pause button for a minute, opening the door for other investors who are still looking for deals. That being said, with prices still fairly inflated, finding a cash flowing, turnkey property in a decent area on the market right now is difficult. Not impossible, but definitely not easy.

Nationwide the pandemic has not seemed to effect rent collection yet since people are receiving unprecedented unemployment payments and the last thing anyone wants right now is to risk their housing. The city of Atlanta, like many other places, has put a moratorium on evictions but this is not the case for the rest of the MSA. So collections are remaining strong and many renters are returning to work as more places of business open back up. 

Please, feel free to message me anytime if you have other questions or just want to chat about the Atlanta market!

Hey @Tyrone Gorham, welcome to the BP community!

So we mostly use closing attorneys here in GA. I'd be happy to refer you to the one my brokerage uses on all of our closes. Most of these closes are with investor-clients too. Shoot me a message if you'd like their contact.