All Forum Posts by: Douglas Christian

First and foremost Mike it sounds like you have made up your mind that this is the property. I see this as a problem for now and down the road.

How long has the property sat there with no takers?

The listing agent is full of it, but you probably gave them that sign of desperation that made them know that you were the one.

Why not scour the same area and find properties owned by landlords free and clear and work with their MOTIVATION and then you will not have to use any of your own money or maybe a little depends on the property.

Second what is the value of this property. So you are going to pay $42,900 and put $7k-10k in repairs.

How much will it rent for?

When I here individuals speaking of this is such a sweet deal and the agent will not work with me. That sends up signals of DESPERATION on your part and why would they have to come off the price or 20% when you are running them down to do the deal.

It should be reverse, but I guess over time you will learn.

I usually charge individuals for this type of info, but for you this one was free.

SUCCESS BREEDS SUCCESS.

Adam forget about the HELOC and focus on finding a house that someone is in trouble with and take the property over SUBJECT TO THE EXISTING MORTGAGE.

You can also do a lease with option to buy and then negotiate not putting down a whole lot of cash and getting rid of credit card debt and other debt.

Loosing a job is not the problem. No on can control that aspect of life unless you work for yourself. With the market the way it is, it should be easy for her to find a home and it might need some cosmetic repairs, but if it is truly a deal and gets her payments down and she like the area, why not go for it.

How about finding a home that someone owns outright FREE AND CLEAR and then letting them owner finance the deal for you.

There are many options, but I am not a big fan on DEPENDENCY.

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Welcome Sand and Steve

Enjoy the ride, have fun and learn. Also, step in and start buying because now is the time.

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Jenny there is a Biblical saying that goes something like this.

Without a Vision the people will perish.

Is that why now in these economic times so many are perishing because they do not see the BIG picture. Look beyond the quick cash and beach front properties that you are dealing with.

What happens when that well runs dry and trust me it will. Just take a look at Phoeniz, Miami and Cali and Vegas just to name a few markets that have people who thought fun in the sun was paying $300k-$500k for a Investment property.

Well I will take my little RAGEDY homes as you would put it and not bulldoze them, but convert them into charming CASH FLOW properties. Find me three people who invested in those markets and I will show you three people who are REALLY HURTING right now.

Unless they just had TONS of money and that still does not make the investment they did any better.

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What area are you in? Find a local wholesaler and see what they have available. Properties are everywhere, just depends on if you are looking to buy and hold or FLIP.

Welcome aboard and enjoy the journey.

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Great point Richard. Also, many of them sorry if I offend, but it has to be said have PAID into a FRANCHISE and now they are trying to recoup there money. But, you are not going to get those people to purchase anything from you.

First find the deals and here is a little advice, I hope that you can find them at a better discount than 30%. In today's market you should be able to find properties for 40-50% on the dollar. If not then you are not looking in the right places or that realtor is trying to sell you on a particular neighborhood.

You must go outside of where you live if you are not getting the desired results.

Here's and example and I usually CHARGE for these, but for you it will be free.

3/1 bedroom home I found and put under contract for $10k I wholesaled it
for $25k and it needed 28k in repairs and it is worth 98k ACTUAL APPRAISAL.

These are simple numbers and they make sense to me and my investor. Never complicate the situation with all the other real estate jargon.

I hope I was able to help you make sense of this.

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Matt, thank you for the compliment. There are many such as you have mentioned divorce lawyers, probate attorneys, eviction court.

Matt go sit in on eviction court in your town. Sit at the back of the room and bring plenty of business cards.

#1 that will let you see the do's and don'ts of being a landlord.

#2 Some of those tenants know how to play the game and the sad part is many landlords do not. They do not protect themselves or their investments.

#3 When some of those novice landlords leave they are so PISSED OFF until they want nothing else to do with being a landlord, but they want everything to do with a 9-5, not guaranteed to last.

I usally CHARGE for my ideas Matt, but for you they will be free.

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Let me jump in and help ride this wagon. Roy obviously you had no foresite when you did this. This is truly what I am telling everyone that you can buy right, but why would you go and OVERLEVERAGE all the other properties. You should never be in a rental property for more than 65% of value.

Here is a possible solution. Contact the mortgage lenders and let them know that you are running into financial difficulities and if possible go speak with them directly. Let them know what the situation is and I believe doing this they can lower the interest rate, give you a interest only loan for 3-5 yrs to make the payments lower.

What really needs to happen also is that you need to find tenants to put into those vacancies. See while you are contemplating what to do, you are missing the big picture again which is even if the rent on one is $600 and there is no tenant then you are stuck paying for that.

What you do is go find someone who really needs a place and put them in for $475 and now you have just narrowed down your problem to $125 bucks and anything you have to pay outside of that will be the COST of you BEING GREEDY and a SPECULATOR.

Sounds like you bought the properties right or at least the one. So, you did do that right, but what you should have done is went and found 5 and paid cash for them and that would have been your leverage for a situation.

But, I guess if you would have done it the way that I have been explaining to people I would have never had the chance to meet and greet you with this blog.

There is a way that seemst right unto man, but the end is DEATH.

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Jon even using your numbers see how simple making money can be. It is the bread and butter houses that made the old school investors there money, why do we feel as though now there is something new.

This is why the country is in the condition it is now. Anyone would love to have 10 properties and cashflow $2500 a mth.

Now, the second part of that is that if you have ten that are free and clear and lets say that they are each worth 50k well that's $500,000. Now, I can take 5 of them and open a equity line of credit using the commercial route and now I become my own bank by getting $250,000 to go and buy an apartment bldg or some more of those same properties. Me myself I would set aside minimum 10% for vacancies and 10% operating cost to do business, but you get the big picture here. Doing business with these types of houses will not stress you out once you get the right system in place.

People are chasing pipe dreams with these homes that are 150k and suppose to be worth 220k. Well how many bought into that and now are like purchasing a car upside down and having to make payments on these because there is to much of this type of inventory on the market.

Where can I go to make the largest return on my investment?

Paul explain your numbers. J paid

$12,900 and put another $2,000 in which made it $14,900

He rents the place out for $550 a month. I am assuming that there is no loan on the property.

So every month he brings in $550 X 12 = $6,600 x 3 yrs =$19,800

typically if you get your return back quicker than 7yrs you have done GREAT and in this scenario it would be about 3 so what numbers are you using.

Paying Cash on smaller homes allows you the cash flow and the flexibility. If someone moves out you do not have to be in a MAJOR hurry to put someone back in the home. Of course you want to put someone in in a timely manner, but it is not like you have a $1,500 mortgage.

Now using those same numbers of $550 mth for 30 yrs = 198,000 minus 10% vacacany and 10-15% repairs you are still looking at $151,470 now take 10 homes like that and tell me where you go wrong bring in $1.5 Mil.

Simple math not complicated. Also, don't be so sensitive, did not mean to put the post in CAPS. I apologize, just trying to make a point.

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