All Forum Posts by: Sean Terry

Wow, congrats newly wed!! DM me when you arrive.

Cheers:

Sean

Hey Joe,

I'm an active fix & flipper and wholesaler in Phoenix. The market here is good if you know what your doing which I'm sure you do.

In this market right now people want the most they can get for their money or a smokin deal. The best method is to give them both.

You need to buy properties 70% less repairs to make your numbers work. Most every contract that comes in these days are FHA and they all want 3% seller consessions.

If you are able to buy properties in good neighborhoods and give them a WOW factor and price them slightly below market you'll sell them quick. Don't think your going to be able to do a half backed reno and sell it at top price, it will never work.

Here's what does work and then I get into areas and price ranges. Fix properties up to the hilt, we do new cabinets, new flooring, stainless steel appliances, 4" baseboards, new AC, new roof if needed, new landscape, new windows. When a buyer walks in to our place they know it's been fully gutted. Now DON"T over spend, just don't buy the house to get a house, buy the house because the numbers work. (if you need contacts for these contracts just let me know)

Now for areas and price: Shoot for $200K and under most of the buyers can afford this price range. As for area I would tell you where NOT to buy and that's Maryvale. Stay within the Loops.

The best method is to drive the neighborhood. You know if its a crappy neighborhood. Are people keeping it up or do most of the houses have weeds past your knees and the garage door is falling off. You get the idea.

If you need anything let me know, I'd be happy to help.

P.S. I love Newport Beach, I have a beach house in Dana Point. We go to Newport quite often to get Sprinkles Cupcakes.

Cheers :)

Sean

Good thread, thanks for starting it.

I have two business models that have been very successful:

1. I fix & flip properties to investors across the country that are looking for a turnkey cash flow property with a tent in place. That being said the properties I do buy and renovate must be 4 units and under and have at least $300/mo cash flow after the PITI payment is made and the property manager is paid. We pay no commissions to a Realtor and we sell our properties to pre-qualified buyers very quickly.

2. I wholesale properties that don't fit the above criteria. We do a heavy volume here in Phoenix. We don't buy bank owned or auction properties at the court house steps. We buy primarily from motivated sellers. Our formula that allows us to sell most of our properties in hours is this: 70% of ARV less repairs. Most of the time our properties are in high 50% to low 60%.

I believe we've been very successful because we build strong rapport with our buyers. I meet them for lunch, go to birthday parties and socialize on a regular basis. I know exactly what their long term goals are and I work hard to help them achieve it. Not one of my buyers can get a better deal anywhere else ( so they think).

Just my 2 cents...

Cheers :)

Sean

Hey Edward,

Sorry I wasn't clear on the assignment explanation.

As for the contract I usually us the standard contract that realtors use. I just put verbage that states "sellers agrees to leave existing financing in place for up to 3 years from COE."

Not knowing the laws in your state I would sugest consulting an attorney but you get the idea.

As for the other documents your title company will prepare:
1. The assignment
2. The exact wrap dcouments
3. The promisory note
4. The deed of trust or mortgage
5. The servicing documents
6. We always have both sides sign a "hold harmless indemnification" document. I do this because I'm over cautious.

I would track down an experienced escrow officer at Fidelity National Title and explain what you'd like to accomplish. I willing to bet they've done hundreds of these types of deals.

Cheers :)

Hey Jim,

Welcome, yes Phoenix is blazing right about now. I have a beach house in Dana Point I spend the summers at. I've been to Redondo Beach several time and love it.

I do some heavy marketing online and offline as well. I look forward to reading some of your strategies.

All the best,

Cheers :)

Sean

Hello Edward,

Thanks for the compliment, I really appreciate it. :)

The NEW buyers responsibility is to refi the property after the 3 years is up or sell the property. By having the title company service the loan it removes US from the middle of the transaction. The title company will follow the letter of the law when it comes to collection.

Remember you're ASSIGNING the contract to the NEW BUYER for a fee in the example $12,500. The new buyer will close on the property and OWN the property, they will be on title.

The new buyers will do a "rate & term" refinance, after the 3 years is up, which for a primary residence is quite common.

Remember disclosure is very important, we disclose EVERYTHING. If all parties are in full understand than I've never seen a problem. The new buyer will make sure they have the credit and income qualification to meet the lenders criteria to obtain the loan and pay off the sellers existing loan.

I hope this helps, your throwing away thousands of dollars on leads that I'm sure you pay a pretty penny for.

Cheers :)

Sean

All great responses!

I can tell you most of the big boys are looking for equity, and if a property isn't a "clean" deal with 30%+ equity they'll tend to pass it over.

We've been very successful with marketing to sellers that have little to no equity. They can't be upside down but ideally they'd have $5K to $20K in equity.

You find these sellers by targeting the expired listing in the MLS. The seller is motivated and is open to creative solutions.

Here's the strategy which is nothing new: Send the seller a Yellow Letter telling them you want to buy the house. When you meet with them negotiate to keep the existing loan in place for up to 3 years and give them $1,000 to $2,500 cash.
Your essentially buying the property "subject to" the existing loan.

Once you have the deal tied up you can then market the property on Craig's Lists offering 'No Qual Seller Financing" your looking for a retail buyer that has $10K to $15K as a down payment.

You then assign the contract to the new buyer for the difference between what you agreed to pay the seller and the down payment. ($15,000 down payment - $2,500 cash to seller = $12,500 profit)

This in any market is a HUGE opportunity. Just be sure you have the title company service the loan by collecting the payments from the buyer and pay the sellers mortgage company. This way everything is audited.
Do be aware that most bank have the right to call the note "due on sale" although I've never heard it happen.

Hope this helps,

Cheers :)
Sean

YES & YES Again!!

We use hand written bandit signs religiously with great success for both buying and selling properties.

We have one of our crew members put out between 50 to 100 a weekend consistently. We pay them $1.50 per sign.

Thanks for sharing the positive experience.

P.S. Make sure you have the calls go to an local eVoice number, not your cell.

Cheers :)
Sean

We use Yellow Letter Marketing, just Google Yellow Letter and you'll find many companies to choose from.

We are averaging a 11.2% response rate.

The next MOST important question is what list are you marketing to. And the answer to that is...Inheritance List & Absentee Investors.

Cheers :)

Golf for sure, such a relaxing fun strategic game.

I also enjoy podcasting

Sean