All Forum Posts by: Jeff Copeland

@Martin Z. - I know you mentioned Android (I'm am Android guy too), but I really like Interior Design for iPad.

It's not a high end CAD program and probably won't cut the mustard for architects, permits, etc. But if you just want to measure up your rooms and then experiment with different layouts, furniture arrangements, etc, it's perfect and pretty easy and intuitive to use.

It's particularly useful for visualizing your designs and showing them to contractors and clients. I'm including a couple of pics below (starting with a completely gutted 10x10 space): one is the kitchen I designed using the app, and the other is the actual finished product.

At a cost of less than 10 bucks for the App, it's worth spending a few hundred on an iPad if it meets your needs!

@Michael Worley:

I frequently get errors saying the BP site is unavailable, or "an error occurred in the application and your page could not be served". This happens several times per day.

I assume it's a result of high traffic - just wanted to let you know there are probably a lot of users out there getting frustrated with the down time.

It's particularly frustrating when trying to post something, then you get the error after you hit submit and have to start over!

Thanks,

Sorry for the double post - BP server errors are driving me crazy and making the site almost unusable today!

@Justin Williams, check out Sendpepper, aka Office Autopilot also. Very robust form builder, lead capture, CRM database, and direct mail all under one roof. 

Like many, has a bit of a learning curve, but well worth it:

@Alexander Felice - While not a "protected class" per se, people do have a right to keep and bear arms under the 2nd amendment, particularly in their domicile, and I would caution against infringing on a tenant's constitutional rights.

@Sarah Jones - State and local laws on top of federal and constitutional issues make for a tangled web of gun laws, and I would consult an attorney before trying to ban ownership of guns in a rental agreement. I'm not saying it can't be done, but it might prove difficult to enforce. 

Is it a flip or a buy and hold?

I had a very similar situation recently (ironically on a 1008 sqft 3/1), and when I ran the numbers it was a wash (on a flip).

The delays caused by designing, permitting, and inspecting the second bath would have increased my rehab and holding costs, and delayed other parts of the rehab, to the point that it didn't make sense to add the second bath. 

The 3/1 sold immediately, so not having the second bath didn't affect the sale on the back end. Granted, it may have sold for 25k more as a 3/2, but it would have cost me close to that much to add the second bath when everything was factored in.

You'd have to do a similar analysis on rental income comparisons if you intend to hold it.

@Erin Elam - Anytime you can do your due diligence prior to the offer and not have to use an inspection contingency, that makes your offer that much stronger (all other things being equal).

However, in some cases, the utilities (water, gas, electric) may be off - making an inspection of the plumbing, electrical, appliances, and HVAC impossible. Not inspecting these can be a big risk.

You may also be competing with other cash buyers and need to move quickly. In this case, the inspection contingency buys you some breathing room for your due diligence, and that's what it's intended for - get in under contract, then take use your inspection period to do an in-depth inspection and confirm your rehab numbers.

Conversely, if the property is an "off market" lead and you're confident that you're the only one working with the seller, then you might be able to take your time. 

It all depends on the situation!

@Garrette Becker - Sorry for the delay, I was out of town.

First of all, I don't really think you have any choice but to use an inspection contingency if your sole intent is to wholesale a property. If you get a property under contract with a 10 day inspection period, then you have 10 days in which to assign the contract to another investor, or back out and not lose your earnest money. 

Personally, I don't like this tactic and don't recommend putting a property under contract unless you are in fact willing to meet the terms of the contract and buy it if it comes to that. 

However, if you got properties under contract with no contingencies, then lost your earnest money on every contract you were unable to assign, your career as a wholesaler would be a short one indeed!

Conversely, as a rehab/flip property, use of the inspection contingency may or may not be warranted. If the utilities are on and you are able to conduct an inspection prior to making your offer (and you have the knowledge, skills, and ability to do so and accurately estimate repair costs), then you might not have a need for an inspection contingency.

You could also just skip the inspection and assume the worst as far as repair costs go - if you can afford to absorb any surprises that might pop up as a result of not doing a full inspection, and the numbers still work, then why not make an offer that plans for the worst and hopes for the best (in terms of repair costs)?

Finally, the value of a piece of real estate is the value, period. Including or excluding contingencies in your contract does not change the value, per se, and doesn't necessarily mean you will pay more or less. But it can definitely make your offer more attractive in a competitive environment. 

For example, imagine you have a home for sale that is valued at $100k at full retail, but it needs $10k worth of work (making it worth $90k) and you're willing to take a discounted price of around $84k for it because you just got a new job in Timbuktu and you need to cash out and move as soon as possible. Which offer would you take?

• Buyer A is offering $84k cash (no financing contingency) with a $4,000 earnest money deposit, but is asking for 10 day inspection contingency and the right to assign the contract.
• Buyer B is offering $84k with a $2500 earnest money deposit, a 10 day inspection contingency, and a financing contingency.
• Buyer C is offering $83,950 cash (no financing contingency) with a $3000 earnest money deposit and no inspection contingency.

Most sellers would take Buyer C's offer over the other two in a heartbeat - they are all essentially the same dollar amount, but if you take C, the deal is essentially done. You are either going to close on the sale in 30 days or so, or keep the buyer's earnest money.

If you take A, you risk tying your property up for at least 10 days, and having the buyer back out based on something they find during the inspection period. Then you get nothing and you have to start over and relist your property for sale.

If you take B, you have the same inspection risk as A, as well as the risk of the buyer not getting financed (which could take even longer than 10 days depending on the terms of their financing contingency).

Hope that helps!

It seems like no one has answered your question yet. The inspection period is a common "contingency" in an offer to purchase real estate (a financing contingency being the other most commonly used).

When you make an offer, you're basically saying, I'm offering to buy your property for $100k, and I'll put up $1k (these numbers are made up) as earnest money or an escrow deposit. If you accept my offer and then I break the contract, you get to keep my earnest money (that's why more earnest money generally equates to a stronger offer).

Then you can add contingencies, such as:

Inspection Period - I want 10 days (or whatever amount of time you negotiate) to thoroughly inspect the property. If I find anything wrong with it or any surprises (or my repair estimates come back too high), I can back out  of the contract and not lose my earnest money.

Financing - if I am unavailable to get financing at acceptable terms, I can back out of the contract and not lose my earnest money.

There are very legitimate reasons to ask for an inspection period (for example, maybe the utilities are turned off and you are unable to inspect plumbing, electrical, or HVAC without them being on). 

But some investors (sometimes on the advice of "Gurus") make lots of offers without seeing a property, then use the inspection period as an "out" while they tie up the property for wholesaling or whatever.

As a seller, an offer with no inspection or financing contingency is much stronger than a comparable offer with these contingencies included, so use them wisely.