All Forum Posts by: James Ihssen

@Antwon C.

Congratulations on finding Biggerpockets!! This is a great place to learn about real estate investing, in fact all facets of real estate, while networking with like minded individuals.  

They say that you are the average of the top five people that you interact with, so this is a great place to 'up your average' so to speak!

Check out the podcasts and the blogs, and explore the forums.  I read on here to find someone that shares similar goals as you and read all of their posts.  That is solid advice that I would like to pass along to you!

Best of luck!  

@Soji Oyenuga Thanks for the speedy response. I understand your reasoning. I will comment on this thread when I receive an email with off market under ARV deals in my locale.

James

I will second @Don Alberts, we communicated via email and I provided all my criteria.  Still waiting to hear back on any off market opportunities in commercial or residential in or around the Chicagoland area.  

Are you just building a buyers list at this point?

Thanks!

Hello! I own a small multifamily property in Hinckley, IL, which is about 25 minutes west of Aurora, IL.  The property is in Dekalb County, west of Kane County.

The property is currently vacant although there are a few units ready to rent. The property is a motel building with single room type units. There is also a detached cottage on the property that needs total rehab. Individual Units will rent for $650 gross.

The property needs some work but would be a super opportunity for the right investor. This is a tremendous cash flow opportunity. The County of DeKalb is okay with future development on the remainder of the parcel via a PUD, or Planned Unit Development, which opens up the property to all sorts of opportunities, from self storage, to (future) retail, to mixed use.

I do not have the time to work on this property and have my hands full with other projects. The property is currently listed on the MLS for $25,000 and I would be willing to take less for a quick close cash offer.

I will also consider owner financing with 60k down on a 3 yr note at 8%.  I am flexible and open to options.  

Please message me, call me on my cell (630-870-9479) or email me ([email protected]) if you would like to view the property or if you have any questions.

Here is a link for more information:

http://goo.gl/nAN0iX

James Ihssen

Congratulations @James Syed!!!

I joined as a pro member and it has been worth it for me as well! Although it has not translated into a monetary gain yet, I have used the investor marketplace to market a property I own that I have for sale, and I have used the analysis calculators to make professional looking property analysis presentations in pdf format.

I am hooked on BP and enjoy spreading the word!

Best of Luck!

The key I have found to a successful BRRRR strategy is getting the deal at the right price. If you cannot get the property for under 70% ARV all in (purchase price plus rehab plus holding costs) then you will need money to put into the cash out refi. The goal is to recycle your money and keep using the same money to build your portfolio, which will not be possible if your numbers are not right.

The local banks do not always have seasoning requirements so that you can begin the process of a cash out refi as soon as you have a tenant in place.  This is nice because you can ramp up your holdings quicker and build your portfolio faster. @Jamal Pitts is exactly correct, the local banks will often keep the loan in their portfolio which is more favorable for you.

A lot of the banks require a seasoning period and that keeps your cash trapped for a longer period of time, which can be especially costly if you are using hard money to finance your buy and hold properties.

BRRRR is a great strategy that allows you to take chunk of cash and use it to buy many houses over time. Just keep your numbers straight and you will do well. I am a broker so I have access to the mls to run my own CMAs, which is a huge help when determining ARV. I ALWAYS go conservative with my numbers and that keeps things safer for me. Worst case the appraisal comes in a little low and I have to keep a couple grand in the deal on the cash out refi side, but even still my cash on cash return is Phenomenal! That never happens to me though! Just know your numbers in advance and you will be successful!!!

Best of luck!!

You can definitely market such deals on behalf of another wholesaler, but be warned like @Jimmy Choumentioned there is a lot of junk out there, so be aware of what you are offering so that you do not become known for offering junk.  I know a few "wholesalers" who are just offering stuff from vision property management or are scraping off the bottom of the barrel and making their own lists.  I used to get super 'direct to the source' lists from wholesalers who were just taking reo lists from rebuildus (not around anymore) and roselandco and offering them as their own.  

That is not a way to build a reputation in this industry.  The best wholesalers have investors piqued with interest when they offer a property because they know that is not junk.

The best wholesalers cultivate their own leads and pass those on.

Just my 2 cents.

@Chris Bojanowski  I am sure that if the property is paid off then it is fair game and you would be in a situation as @James Bitakis mentioned; making a good return on your money as the original homeowner does not want to lose their property due to non payment of taxes.   

Like I said, I do not have a ton of experience in tax liens,  but I know that you will want to at a very minimum drive the properties that you intend to bid on and make sure that they are standing (not burned to the ground) and not condemned.  You can also check the county recorder, although most liens are wiped out by the tax sale.

If you are the winning bidder and that property has been abandoned (meaning nobody will ever redeem it) and it has multiple violations against it, you may have acquired a liability instead of an asset.

I just read in the chicago tribune about a tax lien investment group who basically gave a bunch of houses and lots to a homeless man.  They claimed that it was out of the goodness of their hearts but really it was after the city had filed liens and court actions forcing the property owner to pay tens of thousands of dollars on the property.  Since they were no longer the owner, they were able to go to court and get themselves removed as defendants in the case.

Illegal, no, but unethical?  Absolutely.  

The moral is that if you do not do your research you may never get a return on your money (18%) and may end up with a property that nobody wants or that will cost you money in the long run.  

I am sure there are deals to be had, but to me it is like a needle in a haystack.  And there are already tons of people scouring that haystack!  I am not saying do not do it, nobody ever achieved anything by not doing anything, but at the same time if you only have 10-15k that you absolutely cannot afford to lose then you may be better off with a different strategy, maybe use that money as down payment on a duplex or three flat possibly.  You can achieve cash flow that would easily give you 10-20% cash on cash return on your money and have an appreciating asset with much less risk.  Just a thought and good luck!!

@Chris Bojanowski

One thing to keep in mind is that 90+% of the time there is a mortgage on the property at the tax sale and the banks send representatives there that will bid and win the property at 0% just to protect their interest in the property. 

As I am sure you know, tax liens wipe out a mortgage so they are not interested in earning a return, they just want to preserve their interest in the property.

I was very interested in tax lien investing until I started attending auctions and seeing the same 5 people in suits instantly bidding 0% on almost every single property.

Hope this helps!

James

@Jimmy Chou

Congratulations on finding Bigger Pockets!  This is the place to learn and network with like minded individuals!

The podcasts are super helpful for the new investor.  Also, searching the forums can provide a wealth of information about a specific topic or company!

Best of Luck!!