All Forum Posts by: Chad Carson

@James Wise

Finally got my before pics on the low-priced deal. Tax deed was $1,500, 2013 taxes were about $600, repairs to be performed about $4,500 (paint inside-out, few broken tiles, new gutters, deep cleaning, minor maintenance), so I'm coming in a little higher than expected.

But total of about $6-7,000 on $795/mo rental will still be home run. Hope to have it on market this week.

Hi @Mark Vejnar ,

Welcome! I'm in the Upstate as well over in Clemson. You'll find plenty of mobile home parks in our neck of the woods:)

If you want to start doing some market research for multi-units and mobiles (which is a good learning activity to start with), I'd suggest becoming a customer, i.e. a renter, and shop for rentals in Greenville.

Look on Craigslist, shopper magazines, websites, etc to see what's out there. I'd even suggest going to open houses and seeing them for yourself. It'll be a fun outing for the kids if nothing else!

I have just found that when in a new market, getting feet on the ground and thinking like your main customer, your renter, will make all the other info you learn here on Bigger Pockets even more relevant.

Best of luck and hope to stay connected.

@Drew Farnese

Got your PM. Thanks. Glad to connect.

You asked me how to handle wholesale leads vs buy-hold leads when calls start coming in from your letters.

I really don't break leads down that way.

Some deals may be a perfect buy-hold or perfect fix-flip, but many could be either. The type of lead depends a lot upon your specific plan and business model at the moment.

So if you're into buy-hold right now, I say just focus mostly on that. You'll understand the numbers and the deal-types better since you've studied it.

Absentee owners with a lot of equity should bring you some motivated, retiree landlords. These could be great seller financing candidates to buy and hold.

But when sellers have a lot of equity, you can also give them multiple offers. So if seller financing doesn't work, they might accept a lower-priced cash offer.

When you do your deal analysis on your cash offer, you can build in a wholesale fee below your normal offer price. That will allow you to have the potential exit strategy of keeping for yourself or wholesaling.

@Drew Farnese

You will learn a lot from all of that doing activity. 300/mo is good. Make sure you track your lead generation results religiously so that you can tweak and learn from different changes (like #10 vs invitation style).

What kind of list did you get?

I have found diminishing returns sending too often to certain cold lists, like absentee owners. Maybe 2-4 times per year instead of every week or month in a row. This spaces out the mailings a bit.

Preforeclosures or expired listings are a different story and need to be more often.

"Alone, living like a local in Central America or Indonesia, I could live on very little."

Lol, I hear ya. I am in same boat with 2 young babies. Changes travel a little, doesn't it? And college education is going to be a big wammy,

Even so, I still think just uprooting from current living expenses in USA and finding upper-middle class lodging (hotwater included) in cool places like Argentina, Chile, Thailand, and even parts of Europe can be done just as comfortably and for much less money than life at home.

Anyway, it is fun to plan and think about,

@Brant Richardson

I like your plan. Just a thought, depending upon where you travel you can travel perpetually and live it up on a lot less than $10k/month. Might make reaching that "why" goal come a lot sooner.

Your style of travel sounds about like mine. Take it easy, stop where it looks interesting, and stay a while. Love it.

My short-term number is $5,000/month. I'll want to grow it higher after that, but I'm not too stressed about it. Getting freed up from the basic grind of paying for overhead is my most important goal, and then all sorts of possibilities - many of which it's not even possible to know - will open up.

I like Nobel Prize Winner Muhammad Yunnus' idea of making your money and then using the same entrepreneurial skills and your new-found free time to start social businesses whose ROI is on solving social problems AND dollars. Cool book about the idea: Building Social Businesses

@Drew Farnese Nice job getting started. I've bought a lot of houses using this exact method.

I agree with @Brian L. keep it simple and to the point, as in basically them you're interested in buying their house.

I also agree with @Kyle B. to handwrite envelope. I like invitation style instead of #10 business size. And use the crazy collector stamps that cost the same as the normal ones.

I have bought properties with seller financing even when saying I can buy for cash in the letter or on a sign. The main point is to generate a call. Once you're on the phone, you ask questions and try to solve their problem. If cash isn't the right solution, seller financing might be.

Best of luck!

I echo @James Wise that you should work on credit and down payments, and I agree with @Dawn Anastasi that you should read everything on this site likes it's your new business.

But I'd also recommend looking for a lease with an option to buy as your personal residence. You have to live somewhere, and you could possibly control the price of a decent house, at or below market rent, with a small down payment (option fee), while also building equity.

Here is an example:

Find a motivated landlord who is looking to rent a house for $1,000/mo. Let's say the the ARV = $140,000 and the house is structurally good but needs clean-up and minor cosmetics.

Offer to lease option for $1,000/month for 3 years. You could pay $1,000 upfront option consideration for an option to buy at $125,000 or lower (not too hard to negotiate). You offer to handle the first $100/mo in maintenance/repairs, and $500/mo of each rent payment is credited towards your purchase price. I'd also try to get a renewal of another 2-3 years for additional option consideration.

You could clean the place up, do some cosmetic fixes if needed, and then in 2-3 years, resell the property or refinance if you want to keep. After 2 years your strike price would be:

$125,000 = original option strike price

($1,000) = up front option consideration

($12,000) = monthly credit @ $500/mo x 24 months

$112,000 = new strike price

If you could patiently sell for $140,000 or more, you've got some good profit built in for 2 years of smart work paying the same rent you would anyway. Or if you refinance, you now have 20% equity, so you have just "saved" your down payment.

Just an idea while you work on your credit and learn other investment strategies.

@James Wise Yeah, crazy. We got lucky playing the game;) I'll take good luck since we take the bad luck too!

I am on iPad without my pics so I will update later.

2 recent deals for 75k total.

1st - 71,000 all in, 3/1.5, 1300 sf + carport, brick single family ranch, good neighborhood in college town. ARV = 125,000, rent 995.

2nd - $3,500 (yes, under 5k) all in. 3/1.5, single family ranch, working class neighborhood near same college town, ARV = 80,000-85,000, rent 795 (got rare steal from tax deed!)