All Forum Posts by: Randy Rodenhouse

Yes, it can be frustrating since on Facebook marketplace. For example, you'll get a lot of people calling that. Just want to put it under contract in the sign the contract. I specifically say that it must be a direct purchaser with cash in hand and no assignments. This gets rid of a lot of unnecessary calls.  You need to look and find properties in your area that are being rehabbed, and stop by and talk the owner(s).  Those are the people that typically have the capital to buy your property with cash.  Also at foreclosure auctions you'll find cash buyers since it is requirement at the auction.  

It's going to be difficult, in my opinion, to sell these notes at 3% rate. Making only $4000 a month for a capital outlay of $900,000+ is poor investment and so you would have to take a large discount in order for most note investors to get involved especially if these are second liens.  

You mentioned it was 3% interest only however the math calculates to a payment of around $3950 a month if it is amortized at 3% and 30 years starting with a unpaid principal balance of $937,000.  If it was interest only the payment would be around $2300 a month. So I'm not sure if it is really interesting only. 

The BRRR strategy is popular among real estate investors as it provides a way to recycle capital and maximize returns over time. However, it requires careful planning, market analysis, and execution to be successful. Investors need to accurately estimate renovation costs, rental potential, property values, and have the ability to refinance to ensure the strategy remains profitable.

In my recent newsletter, I talked about why the BRRRR method is not the best to start off with since there are so many moving parts especially for a beginner and not a great time in today's higher interest-rate environment.

Even just doing one of those is hard enough, but now you have to be an expert in finding discounted properties, rehabbing properties, rental and property management, maintenance, and raising capital and getting loans.

Yes, many times you have to manage the property manager. You may want to look at your financials on a quarterly basis or even monthly until the property is stabilized. Now I'm the topic of renewing the rental with that person that is late you may want to get an extra month payment upfront to start the new lease. That way you have the buffer so you don't get caught at the end when he leaves and is paying on the 30th and leaving on the 30th, if you get my drift.

It's so true. So many people are asking the wrong questions and just hoping for an easy push button way to get into your real estate but that is not how it works or how it will ever work. You have to get in the trenches and do your time and get out there and actually buy something to get the experience that is necessary.  I also get many investors calling asking about properties that I am selling with owner financing and they just waste my time because they've never taken the time to understand how seller financing works or how to go about the process.  I am more than happy to help someone out that takes the time to initially be resourceful and learn as much as they can first and then go out and ask questions. 

In general, a hard money loan will be based on 80% or the purchase price or 65% of ARV whichever is less. Usually a Hard Money Lender will get an appraisal for the after repaired value (ARV) and the loan amount will be adjusted accordingly. The loan will be typically at 65% of that ARV and money will be given out as work is completed (draw). However, with a house that is worth substantially less than $50k will be more difficult.

Typically when the listing is fully renovated, the seller has to get their money back out to pay the underlying loans whether that is a hard money lender or they need to pull out cash to move on to the next deal.  So myself, I stay away from those since I'm not going to be able to buy those creatively using subject to, owner finance or maybe lease option, but instead I would have to buy with cash or bank financing which I avoid.  By the way, I lived in Michigan and Ohio for over 25 years.  Now live in the south...much warmer...lol

We believe the market in 2024 will be flat to slightly higher, depending on the local market. As you stated the shortage of inventory will be the main driver and until that changes, we don't see any substantial downturn for most of the US.  

You could either post it on Zillow in the Rental section and say that you would consider selling the property outright. Or better yet listed on Zillow and put in the comments that you would consider a lease or selling with lease option for the property. Typically people looking to rent a property are not going to buy a property from what I found so the first option probably is not the best. I have listed properties on the MLS as outright sale, or with owner financing, or w/ lease option, etc. not a problem.

Collect there email and information on a webform and then if looks like a good candidate then ask them to do a background/credit check and which costs them $40 or so to do so. Tire kicker wil not pay the $40. Saves alot of time.