All Forum Posts by: Justin Whitfield

Not giving legal advice, but you shouldn't have to record a promissory note.  I don't know your states laws, but getting it notarized is always a good idea, and have 2 witnesses. If your dads friend wants a mortgage to secure his promissory note, you will need to have that recorded as a lien against the property.

I keep a card for each one of my loans that I can easily see all of my balances and payments. 

Also ask for receipts/statements from the lender showing your payments. You don't need to send him anything, you need to get documentation of payments from him.

I fully agree with @Shawn Holsapple's recommendations for books (with the exception of the 4 Hour Work Week, I hated that book), those will build a great foundation for you. 

Rich Dad, Poor Dad is a must read as soon as you can.

Hey Frankie, welcome to BP! Good to see more people from the Upstate

Let me know if I can help with anything

Can you find out why it's up for auction?

Is there something wrong with the property (structural, roof, etc?)? Is it being auctioned off as part of an estate settlement? Owner is too old and just offloading it? 

Use your county records to find out who is the owner and maybe do some research on them.

Most auctions I've been to have a date for interested parties to do a quick walkthrough of the property, even if it has tenants. If the date for that has passed maybe you could contact the auctioneer and ask for a showing?

Most contracts have built-in inspection clauses that you can either keep or waive, especially if it's a Realtor contract or something similar. "As is" doesn't mean you can't do inspections, so there should be a standard inspection clause in the contract.

You can always add anything you want to a contract, so you could specify the contingency on the foundation in addition to the normal inspection. Just give yourself a good enough time frame in the contract to inspect it to your satisfaction.

A mortgage is just the security of a loan, it is something recorded at the courthouse and a lien on the property. The mortgage secures the note (promissory note or mortgage note), which is the loan.

A bank loan would almost assuredly have a mortgage with it.

I'm 25 so I'm not too far away from 19, but it feels like a lifetime. I have absolutely no regrets about my life or my career so far. I've loved every minute of learning and owning real estate.  That said, there's so many things I've learned that there are definitely some things I would have done differently - but mainly done sooner.

A few things I would absolutely do if I had to do it over:

1. Get my real estate license while I was in college. If for nothing else than the experience of the class, meeting a broker in charge and other agents that I could build relationships with. Mainly though, I would learn how to use the MLS and go look at properties even if I wasn't ready to buy any. This isn't a necessity by any means, but since I'm about to get licensed, I wish I had done it sooner.

2. Network. Joining real estate investing clubs, general investing clubs, local non-profit charity organizations. I would get involved and soak up as much information as I could.

3. Read more. I've read at least a hundred books on investing (not only real estate), personal finance, business, and the self-motivation books. However, I wish I had read them all earlier and taken more notes. I would absolutely read with a highlighter in hand. I love flipping through old books I read and seeing things I highlighted 5 years ago.

4. House hack earlier. I was 23 when I bought the duplex I live in, but I wish I had done it either. 

5. Build a relationship with an attorney and a CPA that you click with. This is crucial if you're going to be building a large portfolio of properties and investments. You will always need sound legal and accounting advice.

I know those are pretty basic and not specifics on deals, but they create an amazing foundation for your real estate career.

Looks like a great deal if the numbers are accurate.

Are they financing that balloon due in 10 loan? How are you planning to pay the $460k balloon in 10 years?

Welcome to BP Grant!

That's awesome you're getting into Real Estate Investing. It's one of the most rewarding things I've ever done. 

What is your background? Do you have any experience in Real Estate or construction?

My first deal I found just browsing around the various MLS sites. I found one that was interesting and listed as a bank REO. I searched our public records and found the bank that owned it, I called up and got in touch with the manager of their REO's and met her out at the property.

Once we got inside, it was completely trashed, missing everything including the kitchen sink.  I offered $3,500.00 and they immediately accepted it. I also got the house to the left and a lot to the right which they owned thrown in as well.

I ended up selling all 3 properties for an $8,000.00 profit 4 months later. Not massive $ number wise, but for my first deal and more than doubling my initial investment was very exciting and a confidence booster.

Have you actively researched, found and evaluated properties? Or are you struggling with taking the first step to try and locate some potential properties?

If it's the latter, I suggest contacting a local agent and just letting them know you're an investor looking to buy your first property. Give them some criteria, price points, etc. I did this early on and the agent I first contacted brought me a few deals a month. If nothing else, it gives you properties to practice doing walk-thrus and analyzing. Driving for dollars is another easy way to find some properties on your own, there's plenty of resources on BP for this.

If its the former, maybe you should choose a property you can get for cheap that may have minimal cash flow just to get that first one done. With a background in construction you can add some value and increase that cash flow. A great option is always a duplex and live in one side (house hacking), also plenty of info here on that.

One question I have: You want 50 properties and passive income of $300-400/month? Are you only planning on $6-8 of cash flow per property?

Taking the first step is the hardest, good luck!