All Forum Posts by: Christopher Blanco

When I plug it into my quick calculator I get around $500 a month in cashflow. Still a good deal, but make sure you are accounting for all the expenses.

Have you figured in:

- Capex

- Repair %

- PITI?

- Property Management?

- Lawn Maintenance/Snow Removal?

So, wait, I want to get this straight. You have a group of people, willing to give you $250,000 to invest, and you cannot figure out how to make money off that? Where can I sign up for that problem? What kind of return are your investors looking for?

J Scott's Primer on ARV

What shape is the property in? 

I fixed the sloping floors in my home by ripping up the flooring to the joists. I ran several masonary strings from one side of the floor to the other. I then measured the distance under the string across the joist.  I then cut shims  to level the slope, then glued and nailed the shims to the top of the joists. Floor is as level as can be, and very solid.  You can also sister new joists to the old ones, that was harder for me as I had a ton of electrical and plumbing running along and through the joists. 

Why are you afraid of HML's?

Ask you contractor how long they will take to do the project. If they say 4 weeks, give them 6. Then tell them for each week they come under six, you will give them a % of profit. For example: 

If Contractor performs the work in 4 weeks or less, they will receive 10% of the net profit as a bonus. If contractor performs work in 5 weeks or less they will receive 5% of the net profit as a bonus. For every day the contractor goes over the schedule they will be penalized $100 per day to cover additional carrying charges for the property.

So you are giving them 2 weeks MORE than they asked for, PLUS a bonus if they do what they say. In addition you are covering yourself if they totally screw the schedule. 

You only put up EM if the offer is accepted. As for multiple offers at the same time are a couple of ways to deal with this:

1. Make your offer good for less than 1 week.
2. Put a financing contingency in the offer
3. Work with an HML or private lender to get a line of credit.
4. Only offer on high value targets you intend to close on.

While I agree in principal with POS, I think there needs to be some improvements to make the areas more investor friendly. I would love to go into Shaker Heights more. There is amazing value there, but I avoid it unless it is the best deals. When you are talking about 60-70K POS for a neglected home, tying up 100K in cash PLUS my other rehab work isn't the best use of my money. Why should I put money into escrow to repair a door or window that won't open, when I plan on replacing the doors and windows anyway?

A great addendum would be for something like this: If a POS is more than $10,000 a signed itemized contract with a licensed contractor will replace the escrow requirement.