All Forum Posts by: Chris Pontello

When you put it that way, it doesn't make sense. 

I've listened to some "internet gurus" talk about being able to pay more for a house (through subject to) than its currently worth because of how much the backend value would be. 

So paying the $2 extra for the juice, but being able to portion it out in cocktails that you can charge much more for... 

Paying more to guarantee getting the product versus jumping through hoops (short sale) or possibility of now owning it at all (auction).

I'm only asking questions to understand! I appreciate all the wisdom! 

Hi Chris,

Correct me if I'm wrong as I'm still learning creative financing solutions, but paying them some money would be if I could take over the loan. Instead of a traditional down payment, I would give them some money (maybe just to bring the loan back to even).

The upside if taken over the loan at the current balance, with some rehab and hopefully getting the front lot back would be a nice ROI.

To me at my current knowledge level, this deal only works if taking over the loan - to limit the out of pocket money to acquire the property since the outside reno and new septic would take up the bulk of rehab costs. 

Current balance of loan is around $380k. They are asking $375K but not getting it - so not quite $20k underwater from asking but they're offers so far are around $350k and lower. I'm not sure what the current appraisal value is, but comps in the area range from $600k to $1M+. This is as goofy lot, especially since they let the front lot go. Plus lots of landscaping needed. 

I've been doing some studying on short sales but still working to understand it better. Hoping to avoid added competition in auction haha. 

Thanks! 

Thank you, Joel. I sent you a DM. 

Hi BP community!

Have an interesting situation, looking for ideas on the best way to solve a problem for a distressed homeowner.

The family purchased a lakefront property in a nice area three years ago but then ran into a series of issues, and have abandoned the place because of them.

They are hoping the bank allows a short sale (asking for roughly $20,000 under what is owed)

Here's what's made them so unhappy:

Anytime they used the laundry it was dumping into a dry well, which would back up into the house forcing them to take their laundry to a laundromat instead!! The family has three kids, could you imagine taking all that to a laundromat!

In addition to that, the septic tank is undersized for the size of the home. They were getting it flushed several times a year!

Because of the frustration, when asked to purchase the large lot in front of their house which leads to the main road, they turned it down. This has created a "shared driveway" with the neighbor making an ugly curb appeal, not to mention cutting their lot in half. Who bought the lot in front of their house for $20,000? An auto body shop across the street that "stores" cars needing work there.

Since abandoning the home, major landscaping would also be needed to clean up the walkway to the water.

There are no pictures of the inside, yet, but no major interior renovations were mentioned.

- My first thought is offering cash, but the home owner would most likely just let it go to foreclosure because of how low the offer would be.

- My second thought is offering some cash and taking over the loan - there are no liens on the property yet.

The agent turned down a seller financing option - although it was not ran by the seller - because the agent said the seller is so done with the property that she wants nothing to do with it at all. However, I didn't lay out what that seller financing offer would look like because I'm really not sure if a deal can be made or how that financing would look.

I'm hoping to find a way to get the home owner some money in her pocket if possible, although I need room for an investor to fix the issues and hopefully buy the lot back from the auto repair shop.

Please share any ideas you have!

Thanks!

@Dustin Moore I guess it is a numbers game and the more you reach out to the better chance you have. Very helpful advice, just get on the phone throw out a little about what you do and plant your seeds in as many pots as possible! The worst thing to happen...they say no and hang up, oh well on to the next one! 

@Brian Pulaski I like the spreadsheet idea! I was just writing the properties down on a paper and not really doing anything more after reviewing each property through the county website and running some comps of the areas. I can't find what I used to get home owners number but it was a lot of back and forth and lots of google searching but I was able to get there. There are also some sites you can pay to get peoples contact info but I have not used any of them.

There is still a large wall I have yet to climb over to really start my business. Currently just sitting in the stands trying to write down all the plays I see on the field and figuring out how I will do the same....Almost there though. 

Thanks for the advice gents!  

Happy Monday BiggerPocketers! 

So, I am a completely new wholesaler and I am having trouble figuring out how this works and what the correct course of action is when finding these properties. The "what to do next"....

As a beginner you want to "market" the cheapest way possible so you don't out-market your funds and can no longer keep your name from getting in front of motivated sellers eyes. At least for me, that is what I am trying to do as my funds to sustain marketing are minimal. To some they may not find this fun, but for me I get more excited than a kid in a candy store driving around finding abandoned and run-down properties that I think a savy investor would love to pick up! Maybe because to us, these houses are our candy, adult candy... I have lists of properties in multiple towns, I have gone up and peaked through windows, circled the yards.. I have only knocked on the door of a couple houses (surprise, no ones home) and have not asked any neighbors about the property but as my experience grows I will be more determined to door knock more often. So this brings me into what I am trying to ask of all my fellow BP'ers. 

I have looked up the homes on the county website to find who owns it, and what the tax history and owners address is. I run the comps from all the surrounding homes and recently sold prices were for the similar type of house. I run what the ARV will be and determine what my margin could be depending on what I can get the homeowner to agree on. So, you can say I do my homework, and am fully prepared to get on the phone with the homeowner to discuss their property. But here is where I hit that wall....

Do you send a letter first, or just make the call? (many sales books I have read always say: Pick up the phone, and start dialing!) To which I would have no problem with, and no fear. But, (perhaps this is just a hidden excuse I am making up because i am a beginner?) I don't know how to contact this homeowner if I don't truly know its an absentee owner, or they are motivated to sell or how much equity they could get from the home. It's hard to control a conversation, or sales pitch, when you don't know what type of prospect they are.... this includes the phone call, or the initial letter to make the cold call, warm.. 

I do not have access to MLS, and I have not found someone willing to allow me access or look up properties for me just yet. If anyone has some insight or advice on the best course of action, how to find this information, or just simply... to call anyway and casually direct the conversation into about the home and if they would possibly be considering to sell and slowly turn the call into a sales pitch they didn't see coming.. it would be an incredible help to me!!

Books, videos, scripts, blogs, podcasts, ect. recommendations are always appreciated!

Thank you, 

CP

Thank you, Venison.  These are very helpful! 

My name is Chris and I am new in the game around the Mid-West. Specifically IL (where I live) through to Detroit, MI (where my family lives)

I am new into real estate investing, and new as in I have been studying everything possible the last 6 months, just have't executed yet.

Currently working full time as a Marketing Analyst in Downtown Chicago and studying R.E. on the side. My goal is to quit my J.O.B. once I get my real estate business consistently profitable.

I have been dealing with these various "guru's" on which way is the best to finally get started.. I know the knowledge I would gain from them is enormous and would be much faster than going after it on my own. The dilemma is spend the money on a guru, or put it into setting up my systems , and get out a large direct mailing over a couple months as well as other various marketing techniques...??

I'm looking to really get involved in BP and be active often. If anyone has suggestions, tips, advice I am very open and would be very grateful to hear about it! Also, would love to connect with some people and try to get some deals done! My area is priming up to be a killing in the very near future!!

Thank you to everyone on here and I look forward to hearing from you and connecting! :]

-Chris