All Forum Posts by: Nathan Emmert

Mine is similar, maximize holdings... buy everything until you ran out of cash, than mortgage them for more cash to buy additional properties.  Control the properties and long term they will turn into cash flow and opportunity.

 Is the investor just going to stick it in a savings account and collect 0.09% interest?  Are they retired and going to use CDs to get a few points higher?  Are they able to use the stock market to get 8% long term results?  Are they investors who can leverage cash into 10 - 20% returns?

RIsk profile? A savings account and CDs have about 0 risk... stock market can drop... investors can lose their shirts. What risk are you offering? Is it long term money or short term? What's the collateral? Do you know what you're doing? What's the LTV? What's the exit strategy for them if things don't go right? How risky is investing with you versus their other options?

You also need to discuss liquidity with them.  Will they need to be able to quickly get to their money, not everyone wants it locked up in a 30 year loan.

What are the investor's alternatives?  What are their needs?  What is the risk profile?

This has been discussed to death... there is no 1 size fits all answer.

If you want a starting point... offer 1 - 2% more than what you could get from a bank.

What's your exit strategy?  Are you selling in 2 years or refinancing?

Assuming you plan to refinance, what's the house going to appraise at now? Is the market going to appreciate or depreciate over the next 2 years? Do you have the cash to get down to 70 - 75% LTV if the market does depreciate?

Also curious on those taxes... unbelievably low... electric and water are also pretty cheap compared to what I pay in Utah.

Joe, I'm really going to have to look you up sometime and make the drive across Michigan to talk with you.  While I think there are plenty of opportunities to invest here in GR, Detroit is always looming ;)

I'm just amazed people are still so locked in to Freddie/Fannie requirements.  People, get off your butts and start making some phone calls.  Find a few neighborhood credit unions and see who does portfolio lending.  Those banks make their own rules.  Drives me nuts when people hear the first no and think that's the standard for EVERYONE.  You're likely to hear 9 no's for every yes... get used to it in this business!  The key is for YOU to do some work to get the deals you want.

It's been said so many times and yet still bears truth... if this were easy, EVERYONE would be doing it.

If you want to break the mold and achieve above average returns, it requires you to invest the time, to learn the secrets, to have the knowledge to achieve that.  It's not going to just drop in your lap because you have good intentions.

You can't do a thing with the 24 month lease, it will transfer across the ownership change.

For the month to months, generally you have to give 30 days notice of the intended increase.

Seems like a high ARV with those rentals values in the rust belt.

You gotta remember, if you're going to sell to another investor, there's gotta be some meat left on the bone.  Unless you can move all the way up to a turnkey operator who is selling to passive investors, you're likely going to be selling to an active investor.  An active investor is looking for distressed properties or to buy equity.

One last thing I haven't seen discussed, you need to be far more careful on construction site security in those kinds of areas.  Construction materials are easily stolen and resold... and a building under heavy construction is a dead give away that no one is living there protecting copper, fixtures, appliances, etc.

Can you give us an estimated SOW for what you plan?  I hear a lot of success stories on here but to me success is often measured by how closely you stick to your original plan.  Be great to see what you're planning, what you're estimating, and how you end up finishing against both the plan and your estimates.

Look on Craigslist... check Rentometer... it's not an exact science.

Taxes and Property Insurance are both included in 50%... you should just be looking at P&I (principle and interest) to subtract from what is left over to calculate cash flow.

You also need to include the rehab costs into your initial cash outlay unless you were able to finance those... Down payment plus closing costs plus rehab = total cash outlay for CoC.