All Forum Posts by: Jay Orlauski

I'm not familiar with all the tax implications involved , but I know this much - I do see plenty of wholesalers using an LLC - and I have made offers for investors who were purchasing in the name of the LLC - I haven't really heard of buyers not wanting to sign a contract because an LLC is buying it - but people are strange - there may be a few individuals who feel like something shady is going on if an LLC is the buyer - but everyone is different - I know this didn't answer your tax question but I just wanted to point out that I haven't seen many situations where the seller doesn't want to sell because an LLC is the buyer. Best of luck to you..

@Michael Merritt I will be out of town this weekend - however I would be happy to connect with you  - I also work with a lot of wholesalers in the Fresno area,  and if you are interested - PM me and I can add you to my buyers list so when something comes up, I can reach out to you with it. Have a great day!

I like watching homes that I don't buy - just to see what they sold for -  especially the ones that don't accept my offer - I always keep an eye on them in case of a price drip or it comes back to market. 

Keep looking - it will keep you in practice - keep you sharp and on top of the market. You may start to recognize patterns or sales trends - maybe start to recognize homes that have been sitting and are ripe for a lowball offer.  Even if you can't do anything right now, it still takes time in many cases to actually find a good deal. If you wait till you get approved to find something - it may take you a few months to find one - OR.. if you are running across all sorts of great deals and its driving you nuts not to be able to anything - start connecting with some local investors and see if you can wholesale any of them and make a little extra while you're waiting. At two months away from buying , you should definitely be looking on a regular basis.  Best of luck to you!

Hi there  @Jacob Tudor  -Have you considered removing the porch entirely? Remove it and support the roof with beams maybe? Also are you replacing it with concrete or rebuilding it as wooden porch?   perhaps you can can sell it for 5K - 10k more than you paid for it without any repairs as a contractors special or something. I've resold a house before that ended up being more trouble than it was worth and still made 35K profit on it without ever rehabbing it. Another idea - you can seller carry it back to someone who would otherwise not qualify for a loan - or perhaps they would qualify , but the house doesn't - either way, you can collect some income from it while not being responsible for the upkeep or repairs.  Those are some of the things that come to mind  - Let us know how it works out for you - Have a great day!

@Jacob Tudor

Hi @Troy MacDonald - welcome to BP. I got my start with buy and hold income property using multifamily units that I could live in while renting out the remaining units. Worked great for a time but I sold them all in 2006 or so. I have a triplex now , but am looking for a few flip deals before I get another buy and hold. 

@Matthew Richey - welcome to BP -I have some family in Kent Washington. I have been considering possibly buying some income property there myself - maybe something to help my sister move into. I don't know the market there though.  You have a great idea about buying a multifamily to live in while renting it out - it's an easy segue into real estate and you can manage it yourself to cut down on costs since you will be living on site. I hope you do great - please keep us updated -  I would be interested to see what kind of prices they are selling at in the decent areas of town. 

great advice @Cody Campbell   -    @Alex Katos - Learn the ropes a little and still pursue your investors. I started off as an investor for 11 years before I got my licence - after abut a year and a half of dealing with home buyers, white picket fences, and fussy carpet shoppers -I came to the realization that my preference is to work directly with investors - some of the advantages are that as an investor , I know what many of them are looking for and I understand how to calculate cash flow , rates of return and ROI for people. I have scouted out many of the popular areas for investing and for rentals so I am able help guide them in their search for income. Investors buy more than one property - they may come back over and over again to keep buying more houses so repeat business is great. Working with investors puts me in front of a lot of investment opportunities. Ever since I made my decision I've experienced more personal satisfaction in my work, been more focused, and have opened up more doors than I realized were out there. It is helping me to become a better investor by learning from other experienced investors how they are growing their business.

Best of luck to you  - keep us up to date

@Alex Katos

I would look at what YOU think your time is worth - in other words no one can really tell you what a good profit is because everyone is different. Many people like to use percentages and cap rates and what not - but in the end - the only thing that really matters is " are you satisfied with what you got paid for the amount of time that you out into it? "

How many hours of labor did it take to make that $33K ?  Does it feel like it was worth it to you? would you do it again if you had the chance?  Do you have partners that you are working with that expect a certain amount of return?  these are things that can factor in what is a good deal for  you. 

I look at the percentages and cap rates - but really when all is said and done I like to feel like what I put in my pocket at the end of the day was worth it to me. remember 1% can be $10 or it can be $10,000 - so really what does that mean to you?  what matters is how much you can pocket - and whether or not you could have earned the same amount with less effort.  How do your real estate returns compare to what your bank CD will pay you? or some tax free bonds? are you beating those rates? Are you comfortable with the amount of risk you are taking?  These are all things to consider when thinking about how much you should profit.  I don't think anyone else can really tell you what a good profit is for YOU. ( aside from the fact that it MUST exceed your expenses)  

If you can get an education about how to flip a house and walk away with $33k - may not be such a bad deal - I know people who have paid TWICE that  - just to learn from a guru how to do it.  

Hi  @Lluis Bacardi -  Welcome to Bigger Pockets -  congratulations on taking your first steps towards investing in real estate!  Take a good look at the rends in your area - it sounds like an older neighborhood with mostly rentals - what is the likelihood for capital appreciation? I couldn't tell you because I am not familiar with your area - but it would be a factor for you to look at. If the long term trends for that location do not look good - you may be painting yourself into a corner if you go into a negative cash flow situation. Be sure that you don't maker any offers that would put you in that position.  Be sure to get  a good estimate on repairs too .. there may be more that you are aware of once you start construction on it ( faulty wiring, rusted plumbing, dryrot, etc)  

Is it being rented already? If so then you may be able to do repairs a little at a time so to not deplete all your resources at once. If totally vacant  - then account for the time it will take to repair that you will not be receiving rental income for it and include it in your calculations - 

P.S. -  way to go ! for taking the first steps and starting to analyze properties - as you do it more - you will get more and more familiar with the process. 

Keep us up to date if you move on it -best of luck to you!

Hi Neil -  I have seen many listings specify that only pre-qualified buyers should inquire - and have also seen them make you qualify with a specific lender that they know and trust. As far as being able to view your home - I look at it like this -  @Kristine was right about the state of the market - if a sellers market - be sure that you let the agents know you only want pre qualified buyers coming through - but in a buyers market - it might make sense for several reasons to let them come over and look - the more eyes on it the better - the agent might see it and know of someone else who will want it or another agent who is looking for something similar. Investors many times may not be pre qualified because - as specified earlier -they may not want to line their money up until they know they want the property and you don't want to miss out on those.  Another way to look at it is the convenience factor - are you already going to be home anyway and are not doing anything?  let them come over with their agent. But if you are out and about and you have to arrange to be there have to make some other arrangements like putting up the dog or pretty much anything that is an inconvenience for you ..  and it's something you don't feel like coordinating - make sure they are qualified in advance so that you do not have to waste your time.  

As far as a referral fee is concerned - You might maybe offer some nice Starbucks gift cards to any lender that sends you a pre-qualified buyer as a thank you - I would not make any official statements about paying them every time they send someone to you - but a nice thank you and gift card can go a long way - just be sure to look at the RESPA  rulings to be sure that you are not in violation of compliance.  

http://www.realtor.org/topics/real-estate-settleme...

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