All Forum Posts by: Jim Kalish

Writing a business plan and writing down goals and tracking them is a huge pain in the butt.  Time consuming and usually needs a lot of boring research.  Psyched up to do it yet?  But doing both is what just about any very successful investor or Entrepreneur will tell you is a must.  If you don't know where you want to be or what it means to you then you are unlikely to get there.  Now the directionless ride might be a lot of fun and you may make enough money along the way to be happy and pay the bills.  But if that's all you are looking for, happy and paying the bills, a 9-5 W2 can do that for you as long as you find one you like, stay out of the political BS that comes with trying to climb to ladder, and keep your head down.  You won't be a rock star but you could be very happy. ANd its a whole lot lesss risky.  But if you want to be one of the elite you need to do the boring work as well.  Brandon Turner has a 7 part series on goal setting.  And since he gave it away as a bonus on one of the Go Pro bonuses I think he sees it as a tool for all of us, not a way for him to make money.  And as for a detailed plan, when you get into bigger deals commercial lenders will ask you for it and go through it with a fine tooth comb.  So you don't need a business plan or written goals.  But accept  the fact it will most likely limit how far you will go.  
 

Interesting question because I'm not sure what value there is in knowing what other people's portfolios look like.  If you are looking for inspiration to grow yours then I guess it could be useful.  And when you start getting  lot of responses that tell you about how many doors someone has or how many properties they have flipped I'm still not sure of the value of the information.  Sure, its a great way for people to brag.  And there is nothing wrong with a little bragging.  If I were asking the question I might want to know what lead people to the portfolio they now have.  What were their goals when starting out and what steps they took to reach those goals.  And have those goals changed and has their portfolio changed to meet the new goals.  Or were there market changes that resulted in goal changes and therefore portfolio changes.  So of course I'm not going to share my portfolio.  Partly because its not all that impressive and partly because I don't think it will be of aby value.

But regardless of why you asked, I hope you get a better response than mine that actually helps you.  Best of luck!

So @Jose Ramirez you can see that people rom BPS are more than willing to share their thoughts. Some are a little more polite and helpful than others but a lot of u are will to share. The first thing that you might pick up from the others is that are a lot of ways to get into this business. The key is to start by developing your personal goals and then learn how to achieve those goals. Looking for a mentor is a great start. And getting on BPS is really good way to let people know that's what you want t do. But it might better to meet people face to face and get to know them before asking them to share years worth of knowledge. To that end you may want to find your local REIA and join that. Go to all of the main meetings and sub group meetings and interact. In between meetings read everything you can to do some self education. BP has a lot of good resources. The next webinar you listen to will most likely urge you to become a pro. You will gt a discount and bonus code. Its worth it. And you may very well get some good bonuses thrown in. Min were some great beginner books by Brandon Turner and J Scott. So get those nd read them. Also look for BRRRR by David Greene. Now, armed with the knowledge of how to set your goals, the knowledge you will gain from the webinars and books, and hopefully a mentor, you can get to work. Put your detailed goals in writing and develop plan to reach those goals. Depending on what you want and what kind of capital and time you have you may find that wholesaling isn't right for you. Or maybe it is. But to be successful you need to lay out your game plan, step by step. If you are just so eager to get going an want to do something right now take the advice from @Ryan Howell and house hack.  Its usually a pretty safe and and will definitely get you heading in the right direction.  Then while you grow capital and equity you can be planning and learning.

Best of luck!

Congrats on your purchase. You have gotten some good advice already. But first you need to determine your exit strategy. If you are going to rent it for a few years and then flip it, you should consider what you would do for a flip now. Look at other properties in the area. What type of cabinets do they have. This is a big expense.  You don't want to redo it in 4 years. So at least meet the competition. You can save money now on counter tops. Laminate counter tops are inexpensive and easy to replace in 4 years as long as the rents in the area don't all have solid surface counter tops.  The flooring is something you could go either way on. LVP now will last as long as you get good tenants. And you can get good tenants. We've been renting for 12 years. Once we learned how to get people we haven't had an eviction in 9 of those 12 years. Between my son and I that's over 50 units  And when our tenants move out getting it rent ready is a week long process at most.  Paint and clean. But you have to do your part. Legal background checks, credit checks, checking for previous evictions, 2 years verifiable income and 2 years verifiable rental history. And rental history from uncle Bob doesn't count. It's a lot of work but it pays off. Just be sure to do this for every applicant. 

as for that tile and tub, at least paint it. Then when you flip it you can invest ton replacing it. 

Good luck. 

Edward, welcome to Bigger Pockets and welcome to real estate investing. Reaching out to this community is a great start. But before you "flip a few houses" I suggest you dig into the details. Its not as easy as it looks on TV. Read everything you can on the subject. BPs has a lot of good books. Look for books by Brandon Turner and David Greene. And if you haven't done so already join your local REIA. You will find a lot of great resources and knowledge there to get you started.

Flipping right out of the box might be a little ambitious.  You didn't mention if you are currently working  W2 job.  If you are going to try to get funding form a bank you will need to be.  You can look to hard money lenders who put more emphasis on the deal but will want you to have some skin in the game.  SO you will need some cash.  And if you aren't familiar with construction its going to get even more pricey.  

Look into thinks like buy and hold and house hacking.  With a small investment and a little help you can start to build capital.  A nice little rental will appreciate and in a couple of years hopefully you will be ale to do a cash out refi and have a down payment for rental #2.  Or if you house hack a duplex you live for free for a couple of years and your tenant pays the mortgage.  Then you do a cash out refi, buy another duplex, hack that one, and receive income from the first one.  As you can see this is not a get rich quick industry.

Now if you are set on flipping, which is the fun part of this game, look for partners who have been doing it for a while.  Sure, the profit is less but you will learn the ins and outs and be on your way.

Best of luck!

At 80% LTV the most you are going to get is around 146k. Since you owe 156k you would have to borrow 10k just to break even. So this approach isn't going to work. There are other ways to get into investing if you are set on doing it now. If you find a house you can flip you can use hard money or partners. Do this a couple few times and then you have some money to invest in buy and hold. If you are willing to wait saving up is a good approach. The suggestion to rent out a room or 2 is a great idea. In the mean time start doing your home work. Read everything you can get your hands on. BPs has some great books. And join your local REIA and start networking.

there is one other approach. Sell your house and take the proceeds for a down payment on a duplex. Rent out one side and live in the other. In 2 or 3 years you could tap into the equity and do it all over again. Best of luck

I don't see where you indicate what state you are in.  Different states have some different rules.  But bottom line is wholesaling is legal as long *** you are completely transparent with all parties involved.  The key is to have a good attorney who understand what you are doing.  If you are going to assign contracts rather than completing the purchase nd then reselling that has a greater possibility of getting you in trouble.  The ones who say its illegal may very well not have been honest and above board.  I've even seen cases where the wholesaler closed with end buyer but never paid off the the first owners note.  Now that's illegal.  So your best bet is to clearly define your goals and your market and then find a good agent and closing attorney before making your first deal.

Check out this site.  https://www.simpleshowing.com/...

Welcome David.  I think your desire to be a stand up contractor and boss is admirable.  But I think your view that most contractors aren't that way might be clouded by comments form people who had a bad experience.  Most of the GCs I know value their employees and subs and out of their way to support them.  If nothing else, its a matter of self preservation.  If a GC doesn't have a good team they won't last long.  And this goes for clients as well.  Repeat business and referrals are the life blood of a sloid contracting business.  SO your approach is right on the money.  And yes, I'm a GC.  As for your plan to do work for investors, you stole my idea :).  With all of the new investors in the market today they need someone who knows what they are doing.  And for the experienced investors, they are so busy finding and funding properties having a good contractor is a blessing.  You didn't mention if you are or plan to get licensed as a GC.  You should.  Its not that hard and pays off.  If you are going to go down this road check with your local community college to see if they offer a prep course for the GC exam in your state.  The exam doesn't test how good of a contractor you are.  It tests what you know about building codes and OSHA.  And they are usually written by people who know how to write tests that someone wants you to fail.  SO taking a prep course will help you learn how to take the exam and what to study.

Good luck!

You've gotten a lot of good advice so far. In my opinion you have to decide if you want to still try for a decent profit or if you want to get out without loosing your butt. Let's go with the first option. DOM is a big deal. A lot of realtors will tell their clients if its been on the market a long time there is probably something wrong, even if there isn't. Let's face it, realtors can't be expected to work 24 hours a day. So if they are going to spend 2 hours of their day taking their client to a property they want to be sure it has a chance of being bought. So see what you can do to restart the clock. That usually means taking it off the market for 30-45 days and getting a new MLS number. Ask your agent.

So what should you do in those 45 days.  Curb appeal is really important.  This curb appeal of this house isn't the greatest.  There are a lot of bare spots in the grass.  And like someone else said, put in some shrubs with some color.  It will make a big difference.  And since the lawn and landscaping aren't the best you might want to have less pictures of that.

The biggest thing that caught my eye on the inside was the old tile and the 2 different floors. You might thing the old tile has that retro vibe.  Quite frankly in this price range the buyers, probably younger and maybe even first time home buyers, want  to show off their brand new house.  Retro vibe is limiting your market.  And that tile looks a little tired instead of retro.  As for the flooring if you don't want to redo the bedrooms, which I understand, at least address the floor that buts up to the new floor.  The bedrooms are separate and with the doors close it doesn't stand out.  But the area that I think is the dining room should have the same flooring.  I' guessing its less than 150 sq feet so a few hundred dollars would be worth it.

And lastly, when you do relist, take the advice from a lot of experienced people here and list it near ARV or at your bottom dollar price to break even. Like a lot of people said, the market will determine the price, not what you put into it or what profit you want.

Lat comment, it is definitely true, you make your money when you buy,

Best of luck!

I think you're decision to start buying and holding is a great idea.  Even if the market sees a down turn people always need a place to live.  Before commenting on HELOCs I just want to share my experience with rentals.  When my son and I first started we were a little naive.  We always paid our bills so we expected otherers would as well.  WRONG!  There are a lot of people who are what is referred to *** professional renters.  They know how to get people t rent to them and after  2-3 months stop paying the rent.  Then it takes 2-3 months to get them out.  We eventually learned that you have to take emotion and gut feelings out of the decision making process and carefully vet every potential tenant. Legal background checks, income, rental history are all key.  Just make sure you do it the same for everyone.

Now with that little bit of info, which you probably already know, let's talk about HELOCs. First, HELOCs on rentals are really tough to find these days. I've contacted 97 lenders over the last several month and as right now I have found 1 that will do a HELOC on an investment property in North Carolina. It might be a little different in FLA but I doubt it. That lender is TD Bank. PenFed was doing them but they pulled the plug a few weeks ago. I know that because I got in with them the day they stopped doing HELOCs. So I just made it. Still not locked in yet but close. HELOCs, which are always on a property in a personal name, not a business name, are based on the property value and your ability to pay. If you are holding the property in an LLC its a different type of line called a Business Line of Credit. The line is secured by the property but the amount you can get is based on the amount of net revenue the property generates. With TD bank they will give you a line of up to 75% of LTV if your debt to income is ratio is 43% or less. The rate is variable but it usually runs around 1.5% + prime. You mentioned that you bought months ago. SO you might not have much equity. Without the equity you can't get a line. Also, most lenders need to see a steady income. They will take your rent into account but they usually discount it to 75%. And with a limited track record they may not count it all. But they will definitely count the $1,500/month you are paying on principal and interest as debt when they figure you DTI.

SO with all this said using OPM like @William F. Senkowsky suggested is probably a more realistic way to go.  Now once you buy the property using OPM you can look into a cash out refi to pay off the other person and set up a fixed rate mortgage.  But you should work with a lender in advance to be sure you will be able to get a mortgage.  

Another option is to get a partner with deep pockets.  They supply the capital and you do all the work.  This is a tried and true method to grow your portfolio.

Good luck!