All Forum Posts by: Mark Sewell

We have a proof of funds letter that we send out upon request.  Your local HM lender will likely do something similar.

People complain about hard money lender rates (the people that actually invest in your deals and provide free guidance because they don't want to lose money along with you), but yet these same people want to spend $5k - $10k or more on a mentor.  This probably looks like self-serving shameless plug, but I said this before starting my current role as a loan officer with Jet and I'll keep saying long after I'm done.  

There is no easy button, but regardless, there is a cottage industry in offering said buttons.

You have to network.  And in doing that, you get better at doing it.  Who is doing what?  Who is doing what YOU want to do?  How are they doing it?  How did they get started?  People like to talk about themselves.  Get to know people and learn where they are at in their journey.  Take a genuine interest in them.  Don't wear them out but learn what questions you need to be asking.

Remember you are still reading chapters 1 or 2, and you should not be comparing yourself to somebody that is on chapter 29.  Don't get discourage. 

Then later on, when you identify some gaps or areas you are lacking, you might hire somebody to assist or partner with somebody, but I don't advise this at the outset.

I believe this is a reflection of lack of supply at this low-end price point.  New houses are rarely built less than 1800 sf and even those are over $220K.

Even before, in 2019, there was fierce competition to scoop those small 3/1 or 3/2 little houses in working class neighborhoods - if you were lucky you could get them for $85k or $90k and put $20k into them and have a nice little cashflowing rental at around $1350 or $1400 per month.  Most times you had to pay a little more but the numbers would kinda still work.  Not anymore.  Now those are getting scooped up in hours, and the prices are way higher.  It's like buyers just stopped taking condition of the house into consideration.  It could be a pit, foul smells and all, and it's gone in a flash at full asking - just because there is almost nothing under $180k left to buy anymore.

In fact I am starting to wonder if maybe now we are seeing a small resurgence in townhomes/condos at the lower price points as well... people gotta live somewhere. 

Not for cash flow but for appreciation, probably yes.

And really, there isn't that much in Houston anymore that cashflows - not like it was 3-4 years ago.  DFW same way.  Your cashflowing deals are further out now, in my opinion.  I'm doing more and more HM loans in smaller cities.

OK call me and we'll run numbers together.  I do this ALL DAY LONG for people.  I'll give you a guestimate loan proposal which you are free to refuse - but at least you are further down the road than you were.

You CAN get on a team of established investors that do acquisitions - investors that actually buy houses.  Sure they assign a few, they don't keep them all, but they are out there actually doing deals.  And they close.  They don't leave the seller hanging.  Go get with those people and learn.

Oh hey I'm not the expert on this - not at all.  If/when I get ready to do another flip project, I plan to partner with somebody that knows way more than me.

Please step back and really consider the reasons why somebody suggested to you that it is a good idea to start with wholesaling.  What they want is (a) people buying their education seminars and (b) an army of free minions running around driving or dollars and bring them leads.  

Now some of the seminars are worth it, and there are a lot of people that actually DO find deals driving around (eventually), but that doesn't mean you are going to be able to make the jump to doing this on a regular basis.  

There is real cost to doing this on a repeatable basis, just like the other posters have pointed out.   

Frank I think you are on the right track. I took a 3-day weekend training course once here in Houston, with a local REI group and it was really quite good (not a lot of money), and they actually suggested this. They had 4-5 stages of house condition, if memory serves.

I think $10/sf should be your hard-stop minimum budget - anything less and you are just kidding yourself.  Just floors and paint will eat up 2/3 of that, you will still want to put in new trim, new vents maybe, and a few other minor items.  But if you have to level out a floor in one spot, or replace a door or here and there, then you might find you don't quite have enough. Maybe if the house doesn't need floor or paint throughout, maybe some rooms are OK as they are for flooring and some OK for paint right now, then maybe $10/sf works.  Figure $10-$12 sf for light rehab.

I think you might also build in some adders.  Like a medium renovation is $15k per sf plus major items - like HVAC, roof, foundation, or electrical.  The older the house, the more likely you'll need these big ticket items in your budget.

@Chris Hopper is one guy I would steer you to locally on this.

And here we have arrived at the true issue, right here. You think the NAR would let something like this go unopposed, if the Feds were to try to legislate some crazy rule that would take money out of realtors/brokers pockets? Or farmers? Or teamsters? teachers? I suspect there is one and they are getting busy, or maybe one is being formed.