All Forum Posts by: David Ripplinger

I bought both of David Greene's books, Long Distance Real Estate Investing and the BRRRR book. Because I bought the ultimate package, I use the digital and audio books, and I don't need the physical copies. I'm happy to give them free to any investors that might live nearby and can pick them up. I live in Layton Utah, and I work in South Jordan Utah.

(I tried posting this on the marketplace, but I guess I'd need an upgraded account for that. I figured it would be okay to post outside of the marketplace since I'm giving the books away for free.)

@Justin Polston By donut counties, do you mean the counties that form a donut shape around Indy?

@Trent Willey Yeah, I think there's a lot on here about using a HELOC to secure your initial capital. That's actually my plan. Once I have my HELOC set up, it will look like cash to any seller, since a HELOC let's you use it for whatever you want. Another thing people do to get their initial capital is take out a loan against their 401k (I used this strategy to afford the down payment on my primary residence). 401k loans are cool because any interest you pay actually gets paid into your 401k, since really you're just borrowing from yourself. There are quite a few ways people get creative about securing cash for a deal. I think some of them are brought up in David Greene's BRRRR book. It might be worth going back and reading some of it again. (I actually just bought both his books on Friday and read all the way through them in just a few days. Great books!)

I'll send you a connection request and, if you like, I'm happy to discuss whatever topics you feel like via private messages, if you want.

I've been on Bigger Pockets for just a couple weeks, and I love how much I've already been able to learn and connect with people. My brother and I are planning on starting out with the BRRRR strategy in Indiana. But I'm curious, what are all your opinions of the market in Indianapolis (and the surrounding area) versus other parts of Indiana?

@Douglas A Lewis It's not a refinance in the sense of taking an existing loan and refinancing it into a new loan with different terms. It's a cash out refinance, which means starting with no loan and saying "I own this property free and clear. Please give me a new loan with this property as collateral."

Yeah, it can definitely be a tricky subject. I'm brand new too, and just ramping up my education to get started on my first deal. I believe where you're getting mixed up is with the way the purchase should be done. BRRRR almost always is done by paying for the property and rehab 100 percent with cash. Thus, there doesn't exist a loan at the beginning of the process. Let's say I find a home that will appraise for 160k after it's fixed up. I get a good deal on it and buy it for 70k, with cash. I then spend 50k, with cash, rehabbing it because it needs a lot of work. My all-in cost is 120k. I get a renter and then get it appraised for 160k, and now I'm making my first ever arrangement with a lender. I want a cash out refinance and they give me 75 percent LTV, which is 120k. This happens to be how much cash I spent. I now have my cash back, and the property cash flow can cover the monthly payments of the refinance, cap ex, and any other expenses for managing the property. If I chose a good property,this cash flow will be positive. But I didn't need a cash flow to cover two loans because I paid for the house and rehab with cash.

As a side note, if my rehab work was less, say 30k, I would have still gotten the property appraised for 150k (theoretically) and I would have ended up with a cash out refinance actually giving me 20k more cash than I even started with. Alternatively, if the appraisal came back lower than I expected, I might have ended up with somewhat less cash than I had to start.

I'm new to the real estate scene, and I saw this interesting video on getting a very quick initial estimate on rehab costs as you're considering a bunch of deals.

https://youtu.be/EtCDWoJVtOE

Is what they're saying fairly accurate for an initial estimate, as in, using this to filter out most of the bad deals, and then do a more careful estimate on the promising deals? Would the initial estimates change much for a rental rehab instead of a flip?

Update about last pass, since it's been a while since this post has been active. They're continuing to improve in several ways. It's still somewhat clunky to use some apps on Android, but it usually works pretty smoothly, and they give you a feature where you can lock last pass with a PIN any time your screen turns off. Microsoft Edge can now do a last pass plugin (more like a Microsoft Store app, but it interacts with Edge like a Chrome plugin interacts with Chrome). Their web ui continues to improve. I use it for free on several computers and browsers and my phone. It's a life saver.

Is it just me, or is this strategy the well known BRRRR method but with HELOCs instead of cash out refinances?

I'm a software engineer at HireVue, a company that makes video interviewing software. A major component of our business is predictive modeling to aid evaluators in looking at potentially the best candidates first when there's a large set of candidates. Our data scientists are some of the savviest in their profession. It has been cool to rub shoulders with them.

Personally, I have very limited experience with machine learning. I used optimization techniques in various research projects in grad school and at my previous job designing various wireless network protocols. In grad school, I did a lot with feedback systems and control theory. But directly on the topic of machine learning, I only took one undergraduate course.

I'm brand new to even learning about real estate investment, much less beginning my first deal. But already I'm excited about the prospect of using machine learning personally to aid me in solving some problems. If anything, it would be a fun exercise. Given my limited knowledge in both real estate investment and machine learning, I don't expect to actually be using it to get myself started on my first several deals. But perhaps if I have the spare time after getting more hands-on investment experience, I'll look into maybe developing some neural network models to solve some problems. The cool thing is that there are SO many specific problems that could be defined which would all require totally different machine learning models to be developed and could aid in different aspects of the investment industry and be applied to specific types of markets.

If I were to try something out later on, I think at first it might be fun to build a model that could determine something like how good each county is in the U.S. for using the BRRRR strategy on single family homes. The reason for this is that so many people post on Bigger Pockets questions like where in the U.S. to even get started for out-of-state BRRRR or other investing. Lots of people provide great answers, but those answers are typically arrived at from intimate experience in a particular area, and many times the answers are to look in or around certain major cities that are already got markets and have a fair amount of competition. It would be cool to quantify an estimate of how good each popular area is and to potentially discover areas that not many people are looking at yet but are ripe for the picking.