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All Forum Posts by: Gregory Wilson

Gregory Wilson has started 1 posts and replied 139 times.

Quote from @Matthew Becker:
Quote from @Gregory Wilson:
Quote from @Matthew Becker:
Quote from @Gregory Wilson:

I get a postcard or a pretend hand written inquiry about my properties at least weekly. Enormous mass mailings. I think that market approach is saturated.

I wonder if you could look on Zillow or Redfin for apartment rentals that have been unfilled for say more than 100 days. I would think landlords with 100 day old vacancies would be a good lead opportunity.


 Greg is correct.  Everyone wants to make this complicated.  What works best is a letter or postcard.  They have companies that will write them for you with a pen and a computer.  I have bought hundreds of rentals.  I have agents who always contact me directly, and they take both ends of the deal, and I am happy to pick something up.  However, the best way is simple direct marketing.  Send a couple hundred a month so you can digest the responses.  Have a local area code phone number.   You will only get people calling to yell at you if you have an area code from CA.   Get a Google number or burner.  Drive around the area you want to buy in and look for trashed houses in good neighborhoods.  I would suggest you also research the zoning code so there is an additional upside long term.   If you can buy a house with a small cash flow and there is room to build a duplex on the back of the lot, then you get free dirt.  I would also suggest you get a higher price point.  It costs the same thing to fix a hot water heater or remodel a bathroom on a $200K house as a $100K house.  


 I was thinking that the post card thing was worn out, but maybe if one targeted the postcards to reference only addresses that were actively seeking renters on Zillow or Redfin, one could avoid all that waste that comes from blanketing every address in a zipcode.


 A letter is better than a postcard, for sure.  If you can put a picture of your family with the letter, it would really help.  Especially if you have cute little kids and a pregnant wife.  My buddy is a construction worker, and his wife is a nurse.  That plays well.  Once the baby comes and one more on the way, even better.  He has landed two deals in the last few months with a few in the feeder.   The key to the letter is making sure it is very clear you are not a real estate agent.   Lease trusted professions: Congress, car salespersons, Lawyers, and real estate agents.  So, being an agent is detrimental to investing.   I buy property and have had many agents work for me.  I just won't become one.  It costs too much money in lost deals to make too little in commissions.  We just blanket it and see what hits.  It is well worth if you get one deal ever 5K mailers.   Every opportunity is a deal waiting to happen you just have to give them one thing they want and negotiate other stuff.  We do a lot of owner carry backs with older people.   


 The letter with a family photo would be a great product. But, unless narrowly targeted, prohibitively expensive. You have an envelope, printed with addressee (stick on address label says junk mail) two color copies, paper, first class postage.  With labor and material, and not counting the identification and obtaining the addresses of owners and matched to properties, I guess about $2.00 per letter. 

Quote from @Matthew Becker:
Quote from @Gregory Wilson:

I get a postcard or a pretend hand written inquiry about my properties at least weekly. Enormous mass mailings. I think that market approach is saturated.

I wonder if you could look on Zillow or Redfin for apartment rentals that have been unfilled for say more than 100 days. I would think landlords with 100 day old vacancies would be a good lead opportunity.


 Greg is correct.  Everyone wants to make this complicated.  What works best is a letter or postcard.  They have companies that will write them for you with a pen and a computer.  I have bought hundreds of rentals.  I have agents who always contact me directly, and they take both ends of the deal, and I am happy to pick something up.  However, the best way is simple direct marketing.  Send a couple hundred a month so you can digest the responses.  Have a local area code phone number.   You will only get people calling to yell at you if you have an area code from CA.   Get a Google number or burner.  Drive around the area you want to buy in and look for trashed houses in good neighborhoods.  I would suggest you also research the zoning code so there is an additional upside long term.   If you can buy a house with a small cash flow and there is room to build a duplex on the back of the lot, then you get free dirt.  I would also suggest you get a higher price point.  It costs the same thing to fix a hot water heater or remodel a bathroom on a $200K house as a $100K house.  


 I was thinking that the post card thing was worn out, but maybe if one targeted the postcards to reference only addresses that were actively seeking renters on Zillow or Redfin, one could avoid all that waste that comes from blanketing every address in a zipcode.

I get a postcard or a pretend hand written inquiry about my properties at least weekly. Enormous mass mailings. I think that market approach is saturated.

I wonder if you could look on Zillow or Redfin for apartment rentals that have been unfilled for say more than 100 days. I would think landlords with 100 day old vacancies would be a good lead opportunity.

Skip the second home altogether. Its a mistake too many have made. Unless you have discovered some hidden jewel, the traditional second home locations have all turned stale.

And, I am sorry to tell you, you don't have enough money to consider a second home. If you had a couple million in equities and a need to diversify your holdings by adding real estate, maybe. Just maybe. But a person who has $40k in "available cash on hand" needs to hold on to it for a rainy day.

Post: Cancelling Home Purchase

Gregory WilsonPosted
  • Posts 140
  • Votes 85

If not and you wrote them the check, then most likely the $ is gone and suing for that money will cost you more than $1000 unfortunately.


 Agree 100%. But, for future reference, in Ohio there is a little used approach to always get your money back. It comes with some risk if one is not very careful. This is the recording of an "affidavit of facts related to title" under Ohio Revised Code Section 5301.252. The approach goes like this: The buyer records an affidavit in the seller's chain of title, carefully stating nothing untrue. A contract was entered, the buyer attempted to cancel and get the deposit back but the seller refused. End of affidavit. No argument, theories etc., because the affiant can be sued for defamation of title if anything is untrue. But, the seller will never close a sale until the buyer releases that claim and withdraws the affidavit because a new buyer's title company will not issue a title policy and the new buyer's mortgage lender will not make a mortgage loan.

Its not worth doing in this case but when real money is involved it is pretty effective.

Post: Cancelling Home Purchase

Gregory WilsonPosted
  • Posts 140
  • Votes 85

The real issue is how much of a deposit do you have to try to get back from them.

Sure, your contingency might work but I assume you gave the deposit to the seller. Suppose they say "No, sue me." What are you gonna do then?

I know its mean to say that people who do their own contracts get what they deserve, but you must know that if you are paying a couple hundred thousand dollars for something it just might have been worth spending $600 on a lawyer to do a proper contract for you. Right?

I always am amazed when someone selling a $600,000 house brings me a listing agreement where they agreed to pay a stranger $30,000 to list their house for sale and they didn't even read the agreement much less spend the $250 to have a lawyer tell them that yes, if they sell it to their cousin during the listing period they still have to pay the $30k. Or, when the buyer sues everyone for undisclosed defects they have to pay the listing agent's attorneys fees, etc.

Post: DO I need a wyoming trust?

Gregory WilsonPosted
  • Posts 140
  • Votes 85

The predicate for extreme asset protection measures comes from state law. MD is bad compared to Ohio where piercing the corporate veil is a myth - applicable only where the owner (even 100%) has committed a crime or fraud. Maryland has more likely (but still long shot) criteria.

But, it is not safe to assume you won't be sued since the US has about 30 million civil lawsuits pending as I type this.

And, it is against public policy to insure intentional torts. So when you hire that able handyman and give him keys to all of the apartments and the security codes without learning that he is 90 days out of prison for breaking and entering and committing assault and kidnapping your umbrella coverage may not help.

And, these days, a million dollars of coverage will deal with the contents of a small truck that you sideswipe and it bounces around a little with the electronics inside. A serious accident with injured person requiring hospitalization can get to a million dollars in a month or two of medical care.

Hence the efforts by asset protection specialists.

For my part, I just use the LLC approach. One for each property and really good records.

Post: Sub-To Tax Advice Needed

Gregory WilsonPosted
  • Posts 140
  • Votes 85
Quote from @Michael Plaks:

@Gregory Wilson  - partnership return compliance has become insane in the last several years. There are dozens of check boxes, some of them matter, and Balance Sheet and capital accounts are now required. The time of DIY partnership returns has passed.


Yea, I've see all those questions. That is IRS trying to narrow down the number of returns they need to mess with. And, several of the questions are opaque in what they relate to unless one is a tax professional or knows how to read tax code.

Post: Sub-To Tax Advice Needed

Gregory WilsonPosted
  • Posts 140
  • Votes 85

You are right about the first thing. The LLC is the best protection one can get. Of course, we all responsible for our own torts but only the LLC is responsible for the torts of its agents.

As for the second, there are only about 20 monetary numbers to be entered in Turbo Tax on a single unit rental property 1065 so it always seems to me that the $3500 would be better spent elsewhere. But, I was once a paid preparer and prepared or supervised the preparation of tens of thousands of tax returns and I saw some pretty stupid self prepared mistakes. So in the words of Clint Eastwood: "A man has to know his own limitations."

Note to readers: If you have to get your kid to show you how to buy the Turbo Tax software, download from Amazon, and register and update it - don't do it.

Post: Sub-To Tax Advice Needed

Gregory WilsonPosted
  • Posts 140
  • Votes 85

A few things there, Brendan.

First, an LLC with you as a member and your (wife, son, pal, etc.) partner as a 1% member will file a Form 1065 which is about one tenth as likely to be audited by the IRS as a Form 1040 with a Schedule E rental activity (which I presume you will attempt to show is an active business).

Second, you want an LLC because when your local Alabama handyman drives his girlfriend's uninsured truck into a van load of U of A medical school interns on I-22 when he goes to get some shingles for your roof, on your business, you don't lose everything you have or ever will have to an uninsured claim. Of course you could roll the dice and try to show that he is an "independent contractor" and respondeat superior does not apply. But, as Cousin Vinny reminds us, "we're in f******* Alabama."

Finally, get Turbo Tax business and also the 1040 version you need. The $200 you spend will help with your learning curve which you do not want to get from the CPA at $350/hr. When you have about 10 doors, get the CPA involved.