All Forum Posts by: Fred T.

All for Staging here!

@Fred Heller Thanks!

@Ned Carey Thanks!

Just completed some research and it appears there are a few more that do not require a license to Manage Residential Real Estate Properties:

Idaho, Kansas, Maine, Maryland, Massachusetts and Vermont

Florida, however, does require a license...so if that's where you reside then you may have some form of recourse available...consult a Real Estate Attorney in your local.

Good learning post...thanks for the new-found knowledge!/

I too disagree with @Judah Hoover statement that knowledge is not power...and maybe that was simply a mistype..lol

Proper knowledge, in a format best suited for you as a learner (i.e. webinars, podcasts, books, curriculum programs, etc.), is valuable and should be sought before doing anything for sure. The investment into education and knowledge in general is priceless and generally less expensive then your first potential mistake without having it to begin with.

Second step in the knowledge process is, after the foundation knowledge is set and you understand the acronyms in the industry, street talk, construction lingo, valuations, exit strategies...then you can add to your tool-belt some items that may facilitate a further analysis like spreadsheets, apps, etc.

Real Estate Investing is a TEAM Sport, and to try to understand everything on your own to the point that you feel comfortable to then act is an unreasonable expectation.

Surround yourself with a strong Team, an experienced Mentor local to you, have that foundation education completed, put that tool-belt together and then act on a sound opportunity.

NOTE: Wholesaling gives you an opportunity to practice what you learn, gives you an opportunity to vet your Team and affords you the opportunity to valuate the property without risk to start with. Wholesaling, when done right, has you go through all of the tasks that an Investor will go through yet with the risk of usually no cash...it's a great learning experience. When you have Wholesaled a couple of properties properly, then you may be ready to take on your first project.

As mentioned above, Investing is not a sprint...so don't rush yourself.

1) i don't know of a state where performing a real estate function for another is legal without a license...so i would love to know which states permit that

2) if you dont have a lease agreement, then you could be considered a squatter and even if that does not apply...you most likely have no recourse

3) improvements are explained in a lease agreement and most of the time require owner approval and no reimbursements - improve at your own risk

good post with many lessons to be learned/

@Willy M. the information you received is inaccurate.

when you are licensed, the main thing you have to do is fully disclose, verbally and in writing if you make an offer, is that you are a licensed real estate agent acting as principal in the transaction.

there is nothing unethical so long as you fully disclose your status and act in good faith during the transaction.

hope that clarifies the issue./

DISCLOSURE: I am NOT a Licensed Attorney, CPA, SEC Advisor and I AM NOT offering professional advise with this post. As with all legal matters, it is strongly urged with you consult with an Attorney, CPA and other related Licensed Professionals prior to acting on any information offered through a general forum of discussion.

I do not believe there is a limit to members of an LLC not do I believe that was the question to begin with. SEC and Entity Formation do not intermix. Each "Member" of the LLC has to make some form of contribution to that LLC to be a Member pursuant to the Operating Agreement which does not violate any SEC Rules...at least none I have read so maybe someone can enlighten me with the SEC Handout, Publication or Guide number that contradicts that statement.

With that said, you do want to have some form of a relationship with those Members before incorporating them into your business...and if you are just offering a stock position, then you will have to file appropriate Public Offering documents with the SEC.

SEC comes into play when you are soliciting funds from individuals you don't know personally or that you don't have a substantive relationship with PRIOR TO you approaching them. That can be a General Solicitation to a Forum, Solicitation to a Meetup, REI Club, a website you may erect and solicit or a CL ad you may put out into the world to name a few of the most common avenues. There are 2 new sections, with regard to solicitation, that have formed from the Jobs Act which may be worth while for you to research...Regulation D / rule 506 exemptions: 506(b) and 506(c).

SEC guidance has established the principle that approaching specific individuals about a securities offering is not a general solicitation if, before the individuals are approached, they have a substantive relationship with the person approaching them. A relationship is "substantive" if, based on a past business relationship with an offeree, the offeror can form a belief that the offeree currently has such knowledge and experience in financial and business matters that the offeree is capable of evaluating the merits and risks of the prospective investment.

So the main question becomes, do you have a substantive relationship with the individuals you are approaching and if you don't, then consulting with an SEC Attorney is advisable to determine what you have to do before you endeavor upon your solicitation./

Originally posted by @Ben Leybovich:

Isn't anyone on this Forum, who gives sound advise that is, technically a "Guru"?

GURU defined by Webster: a teacher or guide that you trust; a person who has a lot of experience in or knowledge about a particular subject

The word is usually thrown around as a derogatory adjective, but do we sometimes give the noun version to the hype jockeys too many times whereby on some level validating them as such and forget the true meaning of the word? BP is a platform for Gurus of all kinds...and some of those Gurus use the platform to achieve personal gains which is also fine in my opinion...after all, we are an opportunistic society..right?

You can be a "Guru" or have a structured and informative program, book, spreadsheet, etc. and have a "Guru Program or Guru Tool" and that's OK by Webster if the information contained in the subject material is sound, proven, factual and relative to the subject at hand.

So I say...go be a Guru!...produce valuable Guru tools and publications...embrace the sound knowledge that you may have, share it as you see fit and from which you design valuable spreadsheets, informative podcasts/webinars or publish materials...but don't bash other valuable "Gurus" for personal gains.

In most industries, information is welcomed and embraced...yet in this industry it sometimes becomes a cut-throat mission not because the information, program or tool doesn't have value, but simply because of the human nature need to be recognized and valued as a leader figure (some say ego) in a community. I am here to say there is room for all to be valued and respected and feel that a forum should embrace those willing to stand up for their positions and inquisitions if they hold some form of merit instead of always trying to find fault with their language. A healthy debate is one thing, but often times you don't see that when a post gets a running and usually it's because someone feels threatened in some fashion or offended.

This post as it started, and why I chimed in to begin with, had merit and validity. Was there room for debate...SURE! But it seems to have moved from a healthy debate to a non-productive thread as so many of these unfortunately turn into in the end which ends up losing the point all together and becomes more of a distraction instead of a tool for readers to use.

Again...the point of this thread, as it started, was not the Guru Tools themselves, but simply questioned the timing to which those tools are being offered to new investors in training and the manner in which they are offered (published yet not guided) I believe...though I could be wrong!

I stand by the fact that knowledge should go before tools so that one can appreciate those tools more and actually get something useful from them in the end.

Happy Guruing!

Always options available...

1) Blanket Commercial Mortgage w/partial release clause (Max LTVs 75% per property and property must produce a DSCR of at least 1.25 with most lenders up to 1.43 for the rest)

2) Hard Money Cash Out (no limit on properties and not credit driven BUT should be used for short term and only if the property still cash flows with the higher rates - usually between 50-65%LTV)

3) Fannie Mae offers "Limited Cash Out" for 5-10 Investment Properties with a 720FICO

Get with a good Mortgage Broker OR develop a good relationship with your local bank provided they do "Portfolio Loans".

Good Luck!

@Roy Gutierrez IF the delay caused by your contractor was the reason for missing the lock period, then you have no recourse in my opinion.

IF the process by the Mortgage Broker caused you to delay the Contractor or was somehow the Broker's fault that you missed the lock period, then simply ask your Broker to take a reduction of their Yield Spread Premium (YSP) to get you back into the interest rate range you wanted OR they can reduce one of their fees by the $320.

IF the Broker claims to be handling your loan for NO YSP, then say "Thanks!" and be sure to let the Broker know that you will be reading the HUD1 to see if the Broker was paid out a YSP.

When I Brokered Mortgages, I would not lose a lock period to begin with but in the slim chance I did, I would not lose an entire file over $320 for sure..lol

Now if YOU caused the lock to expire for whatever reason...then suck it up butter cup and pay for the extension or simply re-lock at the newer rate.

Good Luck and Stay Firm!

@Collin Cook please don't take this the wrong way, but as a Wholesaler you should know more about the deal, the area, the exit strategy, the construction costs, the ways to handle back taxes, etc. before you can control the property at a price that would make it interesting for an Investor to look at, still provide you a "reasonable" income and the Seller with some form of relief / satisfaction.

War zones are not always bad deals, especially for those Investors with a 7-10yr hold strategy because usually over time the neighborhoods change...perfect example is the Lawrenceville area. If you go into a community knowing that, then you know your target market and makes the Wholesaling easier to accomplish (no matter though you still have to do the work).

The key though is to understand the market, understand the present and future opportunities within that market, understand the deal itself and present a win win option to the Seller and sometimes that does require "work" as a Wholesaler.

So..here is the answer for you...IF YOU would not do the deal with your own money, then it may not be a deal worth pursuing. 

$50,000/$46000 is a loss and $50000/$80000 in a class "C" neighborhood may also be a loss over time. Don't try to force a round ball into a square hole and keep emotions out of Business/ :) 

Happy Wholesaling!/