All Forum Posts by: Paul Leason

I’m assuming your credit score is below 600 then. If it’s above, you should be ok. No1 mission, find out what’s hurting your credit and get it fixed

A Home Equity Line of Credit will possibly looked at the same way not sure. Otherwise that could be an option  

Plan B. Speak to private money lenders or family/friends who have liquid cash and borrow from them. You could use the current property as collateral in case they had concern that you might default. You could write a promissory not giving hem an interest in the current or even the next property that you will purchase. 

@Brandon Lebster Congratulations on the  Air BNB!  Sounds great. One thing comes to mind after ready your mail, why not leverage your property to buy more?  Sounds like you have paid down all debt, which is good in one way, but it will also take you a lot longer to acquire multiple of your own cash flowing and hopefully equity building assets if you don’t leverage. Leverage smart though so as not to put yourself in a hole!  Always have good cash reserves but you could leverage your current place at 75% and have cash for the next one. Then partner up with other investors and create a team of contractors to reduce your flip timing. 

A lot of people wholesale without a license. If you get your license, you will need to declare on any mailings or PAs that you’re a licensed Realtor in the state of MI. Some sellers can be put off by this, thinking you only want to list their property. Furthermore, if you get your license, it doesn’t come for free: you will need to pay insurance and fees, so additional costs to you. 

if you’re wholesaling, you need to:

1. Be prepared to send out a lot of mailers to get the leads. Not talking 100s but 1000s preferably. 

2. Then be prepared to field the calls and have a script prepared. Or pay a call center to do that for you and weed out the luke warm leads and focus on the hot leads. 

3. Then you need to be able to talk knowledgeably to the seller and start building a trust with them and then go view the property once you think you have a good lead. You possibly have talked rough pricing at this point to ensure you’re not wasting your time. 

4. You then need to go to the property, assess it for current value, future value (ARV - after repaired value) and rehab cost.

5. Make an offer considering the above and considering a profit for the final investor buyer. 

6. Market that property professionally to your list of buyers and make the assignment of the PA after showing potential buyers back through the house. 

Easy huh?  Well not really. Wholesaling done well takes investment, a lot of effort and some experience in seeing what needs to be repaired. Rewards can be good but if you get the numbers wrong, you won’t find buyers. 

Dollar profit might be bigger but the %age profit is smaller and for a larger outlay (higher risk) most people would want a higher reward. If you were to sell this on the market for $270k as-is, net to the seller would be around $247k if selling on the MLS. $31k profit with a purchase price of $216k. Minus a wholesale fee and some other holding costs and you're down into the 10% returns. Not great imo, as there's also a risk it might not sell for $270k

@Nick Smith have you tried www.rentometer.com to estimate rents?

YellowLetters.com

Bandit Signs

Scrape the web for delinquent taxes

Buy me a Rowsters Coffee and I’ll tell you the other secrets. 

Sorry. He works for Barnes and Thornburg now. dhill”at”btlaw.com

@Ben Durwood well it seems you are I are completely out voted on this one!  For all my SFHs I make the tenant pay for everything, incl water, yard care and snow plow. I tell them that it’s  like owning the home but I do any/all repairs. I have the City of GR send me a Guardian Copy of the water bill so I can see that they are paying it. If they are not paying it, I get on their case right away.  You can also look the bill up on line and see the balance. And there’s a clause in the lease that states that any unpaid utilities become additional rent, so that IF I need to pay the water, to prevent the lien, then they still are responsible and if it comes to an eviction it will get added to the money judgement. If they move out mid-cycle, you just call GR water and request a final bill to know what they owe.  

For my duplexes, I pay water/sewer, yard care and snow plow.  

IRT @Scott Angebrandt comment about it being a tax right off; I don’t see it makes a lot of difference. If you charge an extra $50/mo rent and then right off $50/mo for water, your taxable income is the same anyway, so no benefit. Net zero. 

That’s the way I have been doing it since 2008 anyway!!

@Scott Angebrandt