All Forum Posts by: Malcolm Lawson

I agree with @Beth H.  going in with your highest and best offer from the start and then standing firm there is allot better strategy in this market rather than submitting low ball offers hoping to negotiate them down.  It will also save your's and everyone else's time.

I get the sellers to pay closing cost on the majority of my contracts.  What I do is get the lender to give me an estimate of the closing cost and put into the contract "seller will provide closing cost assistance up to $8,200" or whatever the estimate is from the lender. It is important to get specific. 

You do have to be worried about vague language scaring off sellers.  I used to put something like "seller with providing closing cost assistance up to 6% of sales price"  just to cover my ***.  But the sellers will crunch the number and 6% may end up being like $12,000.  So if your closing cost is only going to be $8,200 then there is no need to scare like that.

So get specific.  Instead of saying seller will pay "allowable buyer's closing costs, prepaids, prorations and all lender allowable expenses".  Ask your lender how much those will be and ask for that specific amount in closing cost assistance instead

As an agent, I probably wouldn't allow my clients to accept an offer that was that vague either. I would ask the buyer to give me a number.  Now, of course, we are in a seller's market here in Maryland with about 2 months of inventory.  It is very common for homes to be in a multiple offer situation, especially in Annapolis.  If we were in a buyers market maybe things would be different.

Statistically, Realtlors sell homes for MORE money then FSBO. A realtor will also be able to get your home in front of more people than you can by just putting it on Zillow. Also, selling a home can be very time consuming and a huge pain in the ***. It is just better to outsource that job to a realtor.

The only situation I could see it being advantageous for you to sell it yourself would be if it a complete dump and only a flipper would be willing to buy it.

Great video @Karl Krentzel !

Does anyone have recommendations for banks or services to register with to get listings? I'v registered with HUD a few months ago but have never heard anything back.

Should I track down the asset manager of local banks and email them directly?

Rob, that is a fantastic idea! Similar to what I did. Bought a townhome for $210,000 in Annapolis and moved out and started renting it for $1,900 then went on to purchase a second home with the VA loan. Your maximum VA entitlement for Anne Arundel County is $517,500. So if you want to pay $0 for all of them using the VA loan you would really only be able to buy two over the next few years. And remember your VA funding fee goes from 2.15% for the first use to 3.3% for the second. Let me know if you want me to show you any more homes.

I know in PG county you already can not discriminate based on "source of income" which means section 8.  A few other counties as well.  My understanding is you can still deny them, you just can't say it is because they are section 8, you need to come up with another reason.  

I don't own any rentals in PG but I would honestly be a little nervous about having to jump through this loophole next time I need to find a new tenant if they expanded this regulation to other counties.  I feel like it just opens you up to potential lawsuits and other headaches.  I think you would ultimately win as long as you stick to your guns about denying them for other reasons other than the source of income but I still do not want to deal with that stress.

Hey Robert,

I have worked with flippers in AA county and will agree it's TOUGH finding homes with the potential to be a good flip on the MLS. To make it work you really need to reduce your financing cost, by partnering with someone who has money, or reduce your rehab cost, maybe partnering with a contractor. But if you have to pay full price for an HML and full price for the construction, like you said, the number just won't add up.

The only other option is to find homes OFF the MLS which is what it seems like most flippers strive for. Or change your focus to buying rental properties instead. In my opinion, It is far easier to find homes that cash flow positive on the MLS then it is to find homes that have the potential to be a flip.

Hey Rob, 

Yeah, I don't think you are going to like this answer but probably most of the multi-units in Maryland are not properly zoned. The few that are properly zoned usually say so in their listing description on the MLS because it is so uncommon. If you don't feel comfortable investing in an un-zoned multi-unit and investing in a properly zoned investment unit is not profitable and you are dead set on staying in Annapolis then maybe you will have to shift your goal to walking away from this assignment with 1 big rental unit rather than multiple smaller units.

You would have to really crunch the numbers but there are homes that will cash flow MORE as a single unit then they would as a multi-unit. I could easily see a nice 3/2 cash flowing more than if it was split into two smaller units like a 2/1 and a 1/1.  Because multi units are so uncommon here in Maryland, I could easily picture people being turned off from the idea of splitting a home with another family.  This may reduce the demand and as a result the rental income.  Just a theory.  Dealing with on tenant vs multiple will probably be less stress as well and you may even get a higher quality tenant renting a hole home vs splitting it up.

Like @David Faulkner said, you could still rent out rooms in your basement while living there. Only advertise on the Academy so you get some nice military tenants. 

Hey @Mark Richardson i'd be happy to help you find a home. I'll be honest though, in my opinion homes on the MLS are better suited for buy and hold investments. I think the profits will just be to slim for wholesaling from the MLS and it's rare to see something below it's ARV enough to have flipping potential. For those you might have better luck finding homes off the MLS. Try looking at For Sale By Owners.

Hey @Stephanie P. thanks. I'll keep you in mind next time I need a VA loan for a vet.