All Forum Posts by: David Edwards

I downloaded the dealmachine app and signed up for basic service and then I drove around and selected the properties I wanted and paid to get the name/address/phone of the owner. Works out for many properties but they can't find everybody, you don't pay for the ones they can't find

I think BiggerPockets has a deal with them for a discount somewhere, highly recommended if you don't have the time to get to the assessor.

TLDR: Call around to lenders and see if you can find one that will help you aquire a property without a down payment if your numbers come in under 75% of ARV.

I am just getting into the game myself and I lucked into a lender that is allowing me to work deals in the following way:

When I find a property at under 75% of ARV including aquisition / holding / rehab costs then they will fund the whole thing without any cash outlay from me.

What they do however is have their own appraiser give them valuation for the property as is and the anticipated ARV given the rehab that I will complete (they require details on exactly what I will do to rehab the property) as well as my costs for the rehab.

I do have to pay about $500 for this appraiser, this keeps me from having properties evaluated that have no real chance, I still have to do my own review of the numbers to make sure it is feasible.

I do need to have some funds available to cover possible overage against my estimates but this is less then a down payment in many cases. How you aquire these funds is up to you. You could borrow from relatives, they would have a measure of assurance that the money would be safer so long as you run your numbers right and never have to tap it. Heck you could put it into a high yield savings account so that the Interest on that helps pay some of what you offer as interest on the loan. Point is to find deals where you really don't have to touch it, but you can if needed.

Long story short, one of the things they say you should do when entering market is make a list of banks, agents, contractors, and property managers and give each a call to see how they can with with you. Maybe you find a lender with something similar.

I did say that I am new to the game so it is likely that there are better ways of doing this that the experienced among us will point to, but to me, at this point, this seems like a great deal. I am hoping it allows for me to work on more deals in a shorter period of time with minimal cash on hand.

I'm looking to buy portfolio's of investors holding small multi-family homes, 2-4 units withing 5 hours drive of Houston Texas (Beaumont, Corpus Christi, Conroe, College Station, Victoria are some major towns I'm looking at but open to investigate anything). 

With my lender I have identified that currently I can buy 1-2 properties at a time, with each costing up to $200,000 inclusive of all costs (buy, hold, rehab) so long as this cost is up to 75% of ARV and the homes will cash flow. I can refinance them from a Hard money loan into a 30 year fixed long term with the same lender as soon as the rehabs are completed. Conceivably if I can keep rehabs at 2 months or less, with the dollars I have at hand I can take over 6 properties a year, with additional funding could do correspondingly more.

I thought about offering the current owner a remaining stake in the properties if they would meet a price I can work with/seller finance/mentor/some other value, percentage would vary based on the numbers but it would be at or less than 25% that way they could get the cash infusion to move up to larger units but also maintain a stake in the cash flow and appreciation of the units when sold. Would this work?

Would owners of these small MF's be willing to sell at a value that I could BRRRR and maintain cashflow?

How would you handle the conversation?

Anything I should watch out for/be aware of when working to buy portfolios?

I'm vary happy to talk about this.

Thank you!