All Forum Posts by: John Hyatt

Hi Lawrence,

I personally have not done this, but my dad has invested in Mobile Homes and the land for over 30 years and I have spoken with Mobile Home park owners who have successfully done this. Depending on your situation (would need more detail) there may be a lot (pun not intended) to think about. There could be state or city laws that prevent it from taking place, not just the mobile home park neighborhood. If it is permitted then you would need to think about if you can get city water or well water, gas/electric or propane, septic tank or sewage, etc. if you are planning on putting it on an empty piece of land in a neighborhood with houses then I would consider re-sale value and the fact that the neighbors might not like you for it. I am assuming that you already have figured out how you are going to transport it to the land. I guess what I am trying to say is that it depends on what you are looking to do and where you plan to do it. Some cities like Tucson this is common place and others like Beverly Hills might be a lot of hoops to jump through.

-John

FOR SALE - Passive Income. Phoenix. Wholesale price $118,500 to you, Under Contract for $139,900, Rents to the current buyer for $900 per month, Current cost for principal, interest, tax, insurance, and home warranty $665.

Facts:
-Houses are under a 3 year contract or less, longer contracts are available too.
-Buyer-Tenants have been carefully selected and have significant “skin in the game”
-We manage property up through closing (we have a vested interest to close the deal 50/50 split of Equity and Cash Flow)
-All Houses have Home Warranty’s, Buyer-Tenants pay for service calls
- We are constantly reinvesting the money in more deals in case you are interested in more than one
-You can purchase with all cash instead of loan if you prefer
-Addresses have been removed to protect the Buyer-Tenant

I can send you pictures and more detailed information upon request.

Thank you for your interest!

-John

 Great info!! Thank you Roy! I will check out those sites and set up alerts as well. 

Hi William,

Good points, my friend that I was door knocking with is more aggressive than I am. I've been reading Tom Hopkins how to sell anything and what I am getting is that I need to develop my own style and I am more relational like you suggest. I am now doing a combination of Mailers and door knocking. Thank you for advice!! I am using this cool app Spotio now as well, I highly recommend it.

-John

Hi Chris, good point I should have clarified that is how it usually goes down, but not always. I also am not that familiar with other states (I know AZ and a little bit about California). Technically, REO is any real estate that is owned. So although they don't sell it as an REO doesn't mean it's not classified as REO. For example if you own your house outright, you could list it as an REO...(real estate owned). Typically people who own their house cash don't advertise it as an REO (prolly cause they think it's only banks that can). I didn't want to get to technical, so I just provided the basic term for REO as most people know it.

Hi Kathie,

Short Sale – when the borrower owes more than the house is worth and must get the lender and/or the investor to agree to sell for less than is owed. Every lender/investor is different, I have processed over 300 short sales with over 30 different lenders and they each have their own way of doing things (One negotiator at Bank of America told me they worked with over 1,400 investors), but usually they all request the same documents (bank statements, pay stubs, hardship letter, 4506-T, etc). If you owe $110,000 and the property is worth $100,000 the bank must agree to the $10,000 they will be losing (plus commissions and closing costs which makes it more than $10k). Why would a bank do this? So they don’t have to go through the foreclosure process, list a property and wait for buyer, hire an attorney, liability, can go after seller later in some cases, and so on. Note: someone doesn’t have to be late on payments to do a short sale, they can be current (again, every lender/state/investor are different). I would recommend finding an agent who has does short sales and knows the process otherwise it can take a long time. Timeline depends on so many factors (buyer, seller, agents, lender, investor, situation, etc). On average though a short sale should take 90 – 120 days. If you want to buy a short sale just ask a realtor to send you short sale listings or network with people/investors who have short sales listed.

Foreclosure – When someone is late on payments and the bank takes legal action to get them out of the property so they can sell it. Typically when someone says they bought a foreclosed property they really mean they bought an REO property from the bank (even though HUD houses are foreclosed on, only difference is they were FHA loans). Foreclosure is the process, not the type of listing. That's why there is Pre-foreclosure deals. You can look for Pre-foreclosures (properties that are past due, but can't be foreclosed on yet because of state laws, etc). If someone is 60 days past due and the bank will foreclose in 90 days you can buy the property or do a subject to and bring the loan current, depends on the situation (make sure you know what you are doing – seek counsel if not).

REO – Many people define REO as Real Estate Owned by the bank. This is when the bank forecloses on a property and it doesn't sell at auction or they buy it back at auction and list it as for sale. Technically though REO can be anyone who owns the real estate (no mortgage). If you buy a property for $100k cash and you own it free and clear with no mortgage you can list it as an REO property (marketing tip). In this situation though again it depends on the bank or lender selling on the process. My current house that I own was purchased through an REO and it was quite a bit more paperwork than a traditional sale, but nothing too crazy. Again, if you want to buy an REO ask a realtor to send you REO listings.

Let me know if this is what you were looking for…or if you have any other questions/concerns.

-John

Hi Phillip,

I have no experience in operating a pizza franchise, but I do have a couple of stories about pizza franchises:

Story #1: my dad’s friend opened a pizza franchise and worked well over 80 hours a week for several years to barely make it. After struggling for several years he ended up selling the property and made more profit from the sale of the building then he did from all the years of working 80 hour plus weeks combined. As you can imagine this is what got him involved in real estate.

Story #2: my dad owned a commercial building and was looking to buy a subway or dominoes franchise since he could essentially get the land for free (minus opportunity cost and taxes). The commercial real estate agent advised my dad against it, he advised that he had seen several people attempt the same thing over the years and it almost always fails because the franchise in itself is a full time job unless you can afford to hire a manager to care for the operations.

9 out of 10 restaurants fail in their first year, 9 out of 10 of those fail in their second year, and so on.

I am not trying to discourage you from running a pizza franchise, I am only bringing this up to see is this really what you want to do? Are you passionate about food and will you do anything to make the pizza franchise work? Or are you just doing it for real estate purposes and because it’s a cool idea? If you aren’t passionate and if this pizza franchise isn’t your calling then I would recommend against it. However, if its been a dream of yours and you are willing to do anything to make it successful (including working 80 + hours) then I say go for it!

-John

Hi Kewin,

I purchased a house near Arizona State University thinking I was going to rent to college students, the funny thing was I only had a couple of college students inquire (usually not qualified). I ended up renting three bedrooms out to various adults who needed a place to stay and living in the other room. If you are looking to rent the entire house out I would recommend getting a co-signer on a college student and being very very picky in the front end screening. I know it’s hard when you have a mortgage and easier said than done, but it will be well worth it! To answer your question, in Arizona you can do an 8 month lease or 10 month lease, but I am not sure in other states the laws. I would personally stick to 1 year, you never know who will end up renting.

-John

I know in some states like California, I think you have to disclose. I personally dont beleive in so called "hauntings" so I don't know if I could ever disclose such a thing. I might tell someone that the previous owners said it was haunted if I lived in California still. When I was younger we purchased a house that was on the market forever because a girl hung herself in one of the rooms and they had to disclose. I lived in that exact bedroom were the hanging took place for several years and never once experienced a problem.

 Thank you Larry, yes you are right! I just got so discouraged seeing most of them come back, I will keep it up until I have a much larger sample and if nothing then maybe I am doing something wrong and will post again for feedback. I thought about sending yellow letters to the owners, but just testing postcards for now. Great idea about leaving a note, I haven’t been doing that on vacant houses. I love that idea about leaving the sign, I haven’t had the courage to do that one yet. The first time I heard that was at a Mike Watson event in 2006 and I have yet to try it…would definitely be interesting to see results. If I ever gather the courage to do it I will post the results and let you know how it worked out.

-John