All Forum Posts by: Marty Boardman

You mentioned you have a talented father-in-law so I'm assuming he'll be doing most of the work? If so, you've done a great job with your first question. You'll save a lot of money on the rehab by doing the work yourself (or getting a family member/friend that can do it for you at a reasonable rate).

So my take on your questions:

1. Hire sub-contractors directly and pay them directly for the work, and buy all the materials through wholesale outlets (not big box stores).

2. I've found that I attract more desirable tenants with kitchen upgrades like a dishwasher, garbage disposal and refrigerator with water line. I prefer LVP for flooring (not hardwood or tile) because it holds up better and is less expensive to repair/replace.

3. I don't know your area, but where I own my rentals (Wisconsin) tenants will not pay a premium for a basement bathroom so I don't put them in.

Good luck Kevin!

I've never met anyone at a "networking" event that has helped me much with my real estate business.

One of the best (and life-changing) contacts I ever made was at a continuing education class for Realtors. I got nothing out of the class, but I met a guy there named Mark that was buying pre-foreclosures. I bought him lunch that day and got his number. About a week later we met and he brought me on as a birddog for his business. Over the next two years we worked together and did over 40 deals.

The other "best" contact I ever made was through my church (I'm not saying you need to find religion to network, but it doesn't hurt). Hah! Anyway, my pastor introduced me to a guy named Keith that was buying houses at foreclosure auctions. Keith and I had coffee a few days later, and about a month after that he brought me into his business as a project manager and Realtor. I worked with Keith for a year and together we did about 30 auction deals.

I use the knowledge I gained from Mark and Keith everyday in my fix and flip business. The point is that you may want to look in different places for the support/information/advice you're seeking.

For example, I read my local newspaper everyday and look for experts that are interviewed for housing articles. I've met (and have personal cell phone numbers) for two of the top housing analysts in Phoenix. All I did was call them about their research and they happily agreed to let me buy them lunch.

Good luck Daniel!

Hey Jerryll! I'm curious if you'd be willing to share with us what an "awesome website" looks like? I ran a 6-month campaign through an ad firm that specializes in SEO for real estate investors. I spent 20K ($7,800 for their set up and $2,000 per month for ads). I got 13 leads and closed one deal. Hardly worth the investment. They never really brought up my website as the issue. I don't think they really had any idea why the campaign bombed.

When I quit my job in 2003 to flip houses full-time I figured I had to have a business plan. I spent many hours on it and several months refining it. And I never got to use it :(

Because no one EVER asked me for my business plan...

Not a banker, hard-money lender, investor, partner, contractor, Realtor, title rep, home inspector, appraiser, buyer or seller. No one.

Mike asked how you plan to source your deals. That should be your #1 priority. This is the most difficult part of the house flipping process. Find good deals and everything else will work itself out. Good luck!

As Dwayne mentioned, the foreclosure process varies from state to state, and even from county to county. Once you understand how the legal process works in your area then you can develop a strategy that works best (i.e. pre-foreclosure, auction, purchasing redemption rights, excess proceeds, surplus funds).

Colorado is a non-judicial state and there are no redemption rights after the sale. If you can find someone locally (i.e. real estate attorney, title company rep) to break it down for you that would be ideal. I've found local investors don't always like sharing what they know about buying foreclosures because it creates more competition. But it's worth a shot! Good luck Austin!

I'm curious Forest...what do you feel needs to be done at the house? If you're living in it now then it can't be that bad right? The rental market, especially in Florida, is white hot. I'm finding most tenants don't really care if a house is decked out with all the latest design features or not. They just need a house. It may be more profitable (and cost less money) to just do the basics (flooring, appliances, paint) to make it attractive to tenants. Waiting on bigger ticket items like a roof, HVAC system and windows could also make sense because material/labor costs will eventually come down. My best contractor in Phoenix is advising his clients to wait on kitchen/bath remodels for another 1-2 years until the supply chain gets back to normal. Good luck!

What specifically is it you want to learn about foreclosures Austin? How to find them? Buy them? Pre-foreclosures, auction, REO?

I think you already have the best book :)

As for Auction.com, that's not a good source. Go directly to each county for this info (online or at the courthouse/circuit court). I've compared Auction.com's listings to my own foreclosure tracker in Wisconsin. Their list is not accurate and includes houses that are no longer in foreclosure. You'll waste time and money contacting homeowners that have no desire to sell anymore.

I work with local hard money lenders in Arizona and Wisconsin to fund my auction buys. They have no problem underwriting the deal in 24 hours. As Scott mentioned, there's probably a lender in your area that will do this too. HMLs are stumbling over each other right now for deals. If you can bring them some (and pay the loans back) your terms will continue to improve (less money down, lower rates/fees). Good luck Tony!

Call it what you want, that's the term most often used by real estate professionals I know. And door knocking is not the only way to do it. I leave hand written letters on the door, text message and reach out to friends and family to make contact with the owner. There is rarely any confrontation. Most homeowners I meet are relieved to have someone they can talk to that can educate them on how the process works, even if they don't want to sell.

Yes, buying at auction is risky but there are ways to mitigate this risk. The bank's bid is equal to the outstanding principal balance due on the loan, plus legal and late fees. They can't set the bid any higher than what is owed to them. So if this amount is far less than the value of the house it's safe to bid. And you can get a title report prior to the auction that will reveal any outstanding liens. If the first lien position holder is foreclosing all junior liens get wiped out. There are situations to avoid, for example if the IRS or state has a tax lien on the property. But even then you can plan accordingly and still buy the property for below market value. You'll just have to wait out their redemption periods.

As for needing cash, in Wisconsin you only need 10% of the winning bid on the day of the sale. The rest is paid after the confirmation of sale hearing takes place, which usually isn't until 30-60 days AFTER the auction takes place. That's more than enough time to get a hard money or private loan to fund the purchase.