All Forum Posts by: David Zheng

@Beily Pan


Apparently it dropped a behind the scenes deal and the seller wanted to unload it quickly so they put it on the MLS. I was just put in a really aggressive offering with a quick close.

Hi BP!

Just wanted to share one of the most exciting things that "accidentally" happened to me.

Back in Sept, 2016 I was just 9 months into real estate investing and I was browsing Zillow for fun as I usually do. Managed to catch a 3 unit, 3bed1bath/unit going for 260k in an area I like to invest it. Scheduled the showing within a minute and made an offer within an hour of seeing the listing at 230k! Had to go through an HML but it was a deal I couldn't pass up. Closed on Oct, 2016 with a 11% 12 month interest only loan with 80k down (ick!)

Skipped Thanksgiving, Christmas, New Years, and my birthday and went through consistent 80-90 hour work weeks (I have a full time too) and probably 5000 headaches and screaming sessions to get the whole thing rehabbed and ready by the end of January, 2017. Also added a bedroom to make it 4b1b units.

Here are some numbers:

Purchase- 230,000
Rehab- 115,000
Closing/Holding Costs- 17,900

=$362,900
Actual cash invested - $109,900
Existing Debt Obligation- $253,000

I'm renting it out for 2700/unit or 8100/month total

Now I thought this thing was going to appraise for 400-500k originally. Silly me not knowing anything apparently...

Because the Appraisal came back at a whopping $680,000!!!! and the bank is willing to loan up to 80%!!
When I got the phone call, I was in shock because that essentially puts me at pulling $544,000 in straight cash and netting $291,000 after I pay off the HML!
After this refinance, I should still be cashflowing at least $2,000 a month after PITI and expenses too!

Gonna show my soft side and admit I cried like a baby because I started to reminisce on all the sacrifices and pain I went through with this building. It really has been one of the most rewarding moments of my 26 years of life and as an Asian with high expectation parents, I was glad I had something to prove my worth to them.

So what now? Downpayment on a 1.5 million dream beach house I've always wanted? A Lambo because I adore those cars? Quit my job? Go on vacation at least?
nope.

 I already had my eyes set on another apartment building and will be throwing my money there as well as another primary since I just rented out mine recently.

Just wanted to share this wall of post in the hopes of finding like minded investors, inspiring others, and as a big thank you to the BP Family for everything!

Best Community ever :)

From one young dude to another. Here are my tips. and yes you can do all this at once if you have the drive.

- build your credit (no more minimal payments, open small accounts and pay the statement balance in full)

- build your capital (as a freshman in college, I know there is a need to go to social gatherings, etc. but save now/make it big and soon you'll be invited to all the social gatherings)
- connect everywhere. awesome of you to start here at BP. Even your college buds can soon make it big. Half of my investors now are people I knew it college. one of my friends is now an internationally known DJ and I plan on approaching him one day with deals.
- focus on school. Your first job out of college will likely be your stepping stone to the first couple deals in terms of a solid W-2 and cash for a downpayment.

- Always read and learn. blogs, forums, youtube, google vomit. it's all good stuff
- Build a reputation is in my opinion, one of the most important. Show people you are competent and they will throw deals at you. I don't mean put some numbers together and say look at what I did. Drive that first deal. Then the next. then the next. people will notice and come to you.
- Don't be afraid of failing or being said no to, whether you are raising money, submitting offers, or looking for lenders. just ask!

Good luck :)

I just wanted to see if this works.

Let say you buy a duplex with a 5% conventional loan and after 2 months you want to get out and turn it into a full time rental. Do you just approach your mortgage company and pay down 15% of the loan (now at 20% equity) and you are free and clear to use it as a rental or do you still need to wait a year?

or do you have to refinance out of that completely

I actually just returned from Key west. I airbnbed a small and comfortable container home for most of the trip. While Most of the hotels/motels were around 300-400 a night for a standard room, I got the shipping container for $105/night which I think was a hell of a steal since it came with kayaks, snorkeling things, etc.

I think it would be a great airbnb gig if you had like 10+ of these things in key west. granted I heard that regulations were really strict with development of land. though I'm not sure if container homes really count as developments.

Talk to everyone you know. Parents, friends, wealthy family friends are a start. Start with a close network of people who trust you, build a track record and then others will start investing.

The minute I see a negative cashflow I run. I don't care if I'm paying off the equity quicker or anything. As many have said before...you'll make more in acquiring more properties with better cashflow that dead equity in a property.

this is such an open ended question. It's like asking BP who you should marry. Everyone has different opinions on when to quit and not. Some will quit when they have the bare minimum to survive covered. My rental cashflow is 4x over my salary as a big bank consultant, but I don't think I'm going to leave for a while still.


This is a question for yourself and your family. What are your long term goals? Do you find yourself wishing you had more time in a week or still living paycheck to paycheck?

Unfortunately I agree with everyone else that this is just an expensive mistake. whether you get them now or not is already questionable. Even if you did win, these weeds will find a way to sprout up in a different place under a new name.

Not saying you are stupid, but I've realized there is a market for stupid people. I can't go one hour on youtube without Tai lopez or some other "real estate professional" commercial promising education. I can't scroll through a couple pages of facebook without seeing someone advertising a Ponzi or pyramid scheme with hundreds of people commenting, "how do I do this".

Good luck in your fight and I do hope you get something back, but don't be discouraged if nothing comes out of it either

try a 5% down conventional 30 year. You'll still be hit with PMI, but less strict than FHA