All Forum Posts by: Logan Hicks

@Andy Cross

The point andy is usually there are two types of investors, standard investors who are passive, who are willing to put all of the money, in exchange for being given half of all the profits or more depending on the individual, and there are active portfolio building investors, who are constantly building a portfolio of loans.

The second are exceptionally UNLIKELY to finance 100%. 

The overwhelming majority of loans come from the 2nd. A handful compared to industry come from the 1st. The 1st never want to have to lift a finger.

What types of financing are they open to?

@Steve Lyman

Break ownership up of the property, and thus the profits, by a 1,000 dollar increment, and have a simple math formula.

850,000 - 25% (212,500) = 637,500 (637.5 shares)

100/850= .11765% per share.

Owner with the 25% down gets 25% of the profit (obviously), and the rest of the owners split the remaining balance by .11765 * X, where X represents their numbers of shares (by the 1,000 USD they pay in).

Form the location as an LLC, and assign shares that way.

@Scott Carder

Scott I buy a variety of businesses, depending on the performance, age, specific purpose, and market of that particular business.

I dont target any specific arena in terms of what "particular type" I buy, I buy with a specific mindset and discipline, avoiding things such as restaurants, "fad based businesses", franchises, and the likeness. 

The true power and potential in a business is its age, its name, and most importantly, its life span average cash flow net income. 

Businesses present a much higher demand in terms of social skills, creative thinking, and business mindset, but the reward is usually far greater than your average real estate deal.

@Ron Walraven

Ron its not that I wouldnt buy in detroit. I have no mind buying in detroit if I had massive amounts of capital laying around to the point to where I had no use for it, but put it in my perspective.

I can take 1M, put that into about 20 properties in detroit, spend another 1M sprucing them up, creating an exceptional neighborhood in detroit, and sit on the investment for many years (we'll assume 5 for your numbers), and hopefully double my money in that time at sell (4M)

Or...

I can take 2M, put them into 20 businesses vetted by the SBA, buy them on loans at 10% down, with each cash flowing on average 389k net per year, and in 5 years, take my 38.9M in profits, as well as my 20 businesses, and sell each of them for another 20M (Only what I paid for them), and keep a kings ransom of a grand total of 58.9M in my pocket. After only 5 years.

That only outperforms detroit by oh... I dunno... x14.725, or roughly close to 1500% (300%, year over year).

Now hopefully you see why, although detroit is a decent investment (maybe), Id much rather buy things that have been vetted by organizations much larger than me, built by experts far more knowledgable than me, started by people with far more money than me, and has been around a lot longer than Ive been alive. (average business I buy is 30+ years old, Im 25.)

@Scott K.

LOL!

I wouldnt mind a ride along to see the city. im sure I could find at least one property worth buying out of the entire deathtrap that is detroit if we look hard enough. id only ever buy an MFU though.

@Richard Dunlop

You forgot about little ole me. 

Im a heavy anti detroit person, but for things completely unrelated to the properties themselves.

There are no JOBS in detroit relative to other major population centers to mention. Sure you may have a few one off names, but the overwhelming historical fact is that detroit was a manufacturing hub, and those all shipped over seas, or out of state due to not having their personal favors and tax sanctuaries put in place.

Also, hows the police force in detroit? Is it still cut by 70%, or did they finally get the funds to fix that? The bankruptcy? Hows that gone for the city? Is that "enter at your own risk" sign still up at the city limits? 

Overall, detroit and the immeditely surrounding region simply isnt safe, criminally, or financially. 

When most banks wont lend but a small portion of their funds to a major region, there is a parade of red flags as to why. 

Also, any place I can trade a house for an Ipad is no place for me.

Dont use estimations, use exact numbers, frequently reference your documentation, only tell the truth, provide contact information for all of your contractors, insurance claim agents (if applicable), and state that you are asking for ONLY what you were cost, and MAYBE a little more, dont get greedy. You should do reasonably well. 

@Curtis Bidwell

Do you have the paperwork on the current performance?

@Jason Le

As a private money lender myself, if anyone offered me a meager 6-12% for a 6+ month project Id openly laugh at them while shredding their paperwork.

Russian T Notes pay 14%, are backed by 400B USD, and another 6Trillion in other currencies.

REI is a major risk, especially in this market for flippers. The odds of selling fast are low, projections are often wrong, surprise costs cannibalize profits, and permitting processing and costs are getting worse by the year.

@Greg and Darrell

I am currently collecting a pool of other investors like myself to purchase portfolios and MFUs in high population regions if you two are interested. Im on my cell right now, but ill also message you both later.