All Forum Posts by: Joshua Parr
Joshua Parr has started 0 posts and replied 37 times.
Post: How to structure/offer repayment terms to submit to a PML

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
If they aren't familiar with the process of lending on investments, I would keep it simple. Complicating things can drive people away. Otherwise, I would see what's important to them. Some lenders I've used want payments every month and others are fine with getting it all at the end of the project. If it were me, I probably wouldn't do an equity partnership unless they were funding a majority of the deal. In terms of the balloon payment, the plan is to pay them back when you refinance so I would just let them know that.
With it being only 20-30k, I would just do a normal loan at whatever return makes sense for both of you (8%, 10%, 12%, etc.) I think they main thing is to see what their thoughts are and go from there.
With the insurance, it should just be under the name of the entity purchasing the property (the land trust). If the LLC is the beneficiary then you can name the LLC as an "additional insured". However, this is just what I've heard and I'm not an expert in this field so get a professional opinion.
Best of luck!
Post: Tips on getting started in wholesaling with no experience

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
I don't wholesale a lot and when I do, I purchase and then list property. So I don't assign contracts. However, my advice would be to know your state's laws and to find a mentor who is doing it legally and successfully and learn from them. Work for them for free if you need. You will get a wealth of information and probably contacts as well.
For finding buyers, I hear a lot of people have success online like craigslist and facebook groups because there are always a lot of people looking for deals. If you have a great deal, the buyers are easy to find.
For finding sellers, it's definitely harder. Consistent marketing, networking, and creating value for sellers.
Best of luck!
Post: Moving to Sarasota County

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
That limit is definitely tough to work with. Any rehab I do is usually a minimum of 25k so I understand it's a bottleneck. I would maybe suggest maybe finding a private lender (friend or family member?) that could put up the rehab portion and then you can refinance after a year or use an equity line to pay them back. It's always harder when using banks because of their criteria even though their rates are much better.
Post: Moving to Sarasota County

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
You mentioned the FHA 203k already and from what you're telling me, that sounds like the perfect fit (if this property is for you personally. You didn't say but you mentioned the schools so I'm assuming it's for your family). You can do 3.5% down and they will loan on the rehab portion as well. The 203k is originally for owner occupants. From what I've heard lately, some lenders are even doing them for investors now as well.
You could go conventional but you cannot borrow for the rehab portion too unless they package in an equity line/loan as a 2nd mortgage but I wouldn't recommend that. My first property I purchased was on a conventional loan with 5% down and it was a fixer upper so it's definitely doable. However, the 203k is a great opportunity to have little money out of pocket on both the purchase and rehab. Hope that helps, best of luck!
Post: Vacant property -elderly owner

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
I would communicate to the brother that you want to purchase if you haven't already and see what he says. Ask about the situation and how you can help. He may or may not give you the sister's contact info. She is out there and you just have to reach her and show her that you can solve her problem. Even if he doesn't give you her info, it is still possible to find her. You just really have to do some digging. Best of luck!
Post: how to stay organized with all these leads?

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
Personally, my partners and I just use Google Sheets and it works for us. A lot of people out there use CRM systems as well. I guess it's all in what you like and want. If you don't think something like Google Sheets is sufficient than start looking at some online CRM systems. I've heard a lot of people talk and say good things about Podio so you could look into that. I'm not positive but they may even have a free basic package and if you want the upgraded package(s) it's a monthly subscription. Best of luck!
Post: How much was you first property for a live in house hack?

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
Mine was a single family that I rented a room out to a friend so it wasn't a multi family house hack but it worked out well. Bought the house for ~60k and put about ~30k into it. Sold for ~160k 2 years later. My payments were like 500/month and I rented the room for 400/month so most of my costs were covered. I put 5% down on purchase and did a conventional loan.
What I would recommend is finding a 2, 3, or 4 unit to house hack. I would do your first option. There's no use in waiting if you can get financing and get tenants to pay down the mortgage and possibly receive some cash flow. You just have to be sure numbers work and that you'll be fine getting through bad events (vacancies, bad tenants, etc.)
If you can, find a multi-unit that a landlord is willing to owner finance to you. That makes the financing end of it easier and you can put property in an LLC or trust for some protection.
Best of luck!
Post: Should I expect a contractor to work everyday?

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
You should probably fire them and get new contractors, if this has been going on for this long then it will just continue. They might not be bad guys and they might do great work but you can't have them delaying your project this much because the longer it takes, the less money you make.
To answer your question, there needs to be communication up front between you and your contractor about the project timeline and expectations. There needs to be a contract between you two as well outlining all of the details. If a contractor states it will take 4 weeks, I don't care if they are on site 6 hours a day or 12, it just needs to get done in the timeline we established at the start. I understand that they may have other jobs/projects but they should take that into consideration when giving you a timeline.
At the very least sit down with this contractor and see how this problem can be resolved. One tip I always hear is to establish a realistic timeline and have a contract with contractors that states if they finish early then they will get a "bonus" for each day done early (and the work has to be evaluated by you) and they get penalized for each day it goes over the timeline. It's a strategy that can help you going forward.
Great contractors can be very difficult to find but they are out there. You don't have to put up with mediocrity. Hope that helps and best of luck on your project!
Post: Best Way to Purchase a Rental Property

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
I am not an accountant but a down payment is generally not deductible. Always consult an accountant though to get the best tax advice. The down payment is not really considered an expense because you are not technically losing that money. Think of it this way: you are transferring one asset (cash) into another (real estate). You just have to depreciate the asset based on the basis (which includes your down payment) to gain the benefits.
However, the interest on your loan is because that is an expense. Hope that helps, I know I didn't explain that very clearly.
Best of luck!
Post: Scared Newbie, where to start? (Market doesnt seem favorable)

- Flipper/Rehabber
- Cleveland, OH
- Posts 39
- Votes 20
I don't have one good answer but here's my advice:
1. You can be successful in just about any market/any area as long as you understand them both well. At the same time, if you can look at suburbs closer to a city, there is much more inventory when buying and a larger pool of buyers when selling a flip. I would read some books and continue to learn here on BiggerPockets to really understand what goes into flipping a property. There are a ton of people with experience that are willing to share so that other people don't make similar mistakes to what they've done. For example, many people initially don't fully understand all the costs associated with fix and flips so it's good to get a grasp on that so you don't get over your head.
2. Find a local REIA and/or someone who is successfully investing in your market and try and learn from them if possible. Maybe partner on a deal with someone and bring value to the table. Even if you don't make a dime from a mentor, the experience can be priceless.
3. Flipping is a great way to build up some capital initially. However, I know people who have started straight into rentals because that's what they wanted to do. You can get creative with things like owner financing to acquire properties.
I know that was pretty broad but I hope it helps in some way. Best of luck!