All Forum Posts by: Seth Teel

 It's a 2,200 SF Folk Victorian turn of the century house.  As I mentioned, I wanted it done correctly.  Therefore I almost doubled the "required" piers needed to adequately support the house.  It was a judgment call on my end, but my plan was to live in it for 2 years then resell.  I will likely list it late Spring/ early Summer.  The extra work will pay off, I should net over $150K profit and no capital gains tax penalty because it's been my primary residence for 2 years.  Well worth the extra expense.

I have gotten foundation bids on 100+ homes in the last 4 years in San Antonio.  Only a handful of properties (less than 5) have had a legitimate foundation bid over $20K.  So, this seems high to me.  There are several factors that effect the price of foundation bids:  Foundation type (slab or pier & beam), If the property is occupied or vacant, number of square feet, if it's one story or two, how busy the contractor is, whether the contractor is a retail or investor-friendly, and a few other factors. 

The property in question is it slab foundation or Pier & Beam foundation?  How many square feet is the home? Is it one or two stories?  Will the home be vacant when they do the work?  

I had the foundation completely redone on the property I live in.  Removal of old piers, installation of 85+ new piers, several new beams. This is a single-story home coming in at 2,175sf.  The cost was $22K.  That was the most expensive foundation I have ever done. I had two cheaper quotes, but I wanted it done correctly and I paid for it.  Most foundation bids come in between $7K & $12K, with $15K being high, and $20K+ being outrageous.   

For a quick reference when I run my estimates, I take the bottom floor square footage divide by 49 (as piers are supposed to be no further than 7 feet apart on a single story) then multiply by $350.  I add $400 for permit, and $500 for Engineer's report. If the property has two stories, piers should be closer, I usually up the number of piers by 15 - 20%.  

For example: I look at a house that is single-story, 1,150sf, pier & beam foundation. I Divide 1,150 by 49 = 24 piers, multiply by $350 = $8400, + $900 for permits and engineer's letter.  TOTAL COST = $9300.  This is a bit of an over estimation, but it helps when running numbers quickly.  

Hope this helps. 

@Britney Gaudet Most wholesalers use the TREC 1-4 Family Residential contract. Usually in the you would contract in under your name such as this "I buy houses, LLC and/or assigns." Some people add the part about the assignment in Section 11: Special Provisions.

As for the actual assignment document, there are several on the web.  I have even seen a couple people use and TREC amendment to assign the contract.   Shoot me an email and I will send you the TREC 1-4 Family Residential contract and the assignment I used to use when I was a wholesaler. 

Ed Guerrero - Guerrero CPA.  You'll have to google the number as the forum rules don't allow me to post it. 

Welcome.  Hope to see you at some of the networking events.

@Taylor Thompson Sounds like you're a helluva entrepreneur.  Welcome to SA.  If you ever want to grab lunch or a coffee or something give me a buzz.  

I am sorry to hear this happened to you.  It may be time to contact a lawyer.  Also, since you paid him money a couple different times, you may be able to file in small claims court without a lawyer.  A colleague of mine was able to do this. He did not get any money as the defendant never showed, but was able to place a lien on his home for the amount owed as a judgment from the court.  

I'd be interested in learning who this "mentor" is or which company he represents.

@Carol Donaldson

The concerns you raised are par for the course when buying wholesale real estate. There are companies large and small with almost the exact same business model.  All will require a non-refundable deposit (usually $2000 - $5000), most have a "transaction fee" or "admin fee" (usually $295 - $600), and all with require you to pay for the double closings costs unless they can assign the contract to you.  I would definitely ask if they can assign the contract. It's a much easier transaction for you and them.  

If you plan to buy from wholesalers you will need to get used to the "as-is" purchase and on refundable down payment.  This is just part of the business.  This is why it's important for you to make sure you do your due diligence prior to contracting the property.  Often times with wholesale deals, speed is the name of the game, so taking time to conduct lengthy due diligence is not an option. This is where educating yourself  and building your team becomes so important.  If you work with a good wholesaler or good agent, they should be able to help you make quick decisions.  

A lot of newer investors get hung up on the items you mentioned. I don't find any of them to be a big deal. The most important thing you can do is check their numbers. Is the ARV accurate? Does the rehab budget include everything needed to meet that ARV plus a 10% contingency? Does the price, rehab, and ARV meet your percentage requirements after holding costs, closing costs, commissions, hard money fees, permits, & other soft costs?

If your answer is "yes" to those questions, then it's a deal and there shouldn't be a worry about a non-refundable down payment...after all it is applied to the purchase price of the property and it is refunded if they cannot provide clear title.  This shows your intent to purchase and protects the wholesaler should you get cold feet and they're stuck losing their front-side earnest money, or heaven forbid, actually close on the property.  

When I was a full-time wholesaler most of clients were able to pull the trigger within minutes of entering the home, some trusted me enough to buy sight unseen on my recommendation, and some always wanted to get a contractor in there or run the contract past their lawyer. Most that fell into the last group are no longer "real estate investors" or they chose to purchase at retail prices from the MLS. There is money to be made buying from wholesalers, there is money to be made buying at retail off the MLS. It all just depends on your level of comfort and strategy. For me, I much prefer to purchase from wholesalers or directly from the owner. I like the exclusivity of it and feel I get better deals than those offered by real estate agents.

Lastly, if you are truly worried about this specific company, I would first check the BBB, and second ask one of their agents if they have any references.  Feedback good and bad will definitely be prevalent within your local RE community.  

I hope this was helpful. 

@Justin Kane I will be at Chad's tomorrow.  I am also going to try and make Rick's next week.

Welcome @Steve Strayer.  There are a couple free (no pitch/ no membership fee) RE MeetUps here in town.  Both @Rick Pozos & @Chad Clanton run these MeetUps.  

Chad's is this Tuesday @ 6PM at The Geekdom Event Centre 131 Soledad Street San Antonio, TX 78205.  

Rick's is next week 2/10/16 7PM @ Luby's Cafeteria, 4541 Fredricksburg rd, 78201.

Hope to see you at one of these.