All Forum Posts by: Richard Warren

Perhaps I’m missing something here. I have no commercial experience, but if everything stays in your name how is it a sale? Is the title transferring or not? If it does transfer, how do you get a bank to give you an equity loan on a property that you don’t own?

8)

In that case it is a lease-option deal. You will be charging rent, not interest and all expenses related to ownership are yours. You can’t have it both ways, you either sell it or you don’t.

8)

If you are owner financing the property, you have sold it and no longer own it. Therefore you have no equity to borrow, you can’t take out a loan on something that you don’t own.

8)

Oil closed Friday at just over $123 per barrel. That’s a drop of 16% from the high of $147 just a couple of weeks ago. Looks great, but gas prices here have only dropped about 3%. I know it takes a while for lower prices to work their way into the market, but why is it that when oil prices rise gas goes up instantaneously?

8)

You got a better deal than my club. Here it was $2,000 for the package.

Here the first 7 people could have the software for $1. That is only the initial charge, you still have to pay the monthly fee. Though he says it is from a different company, you can rest assured that he gets a piece.

The difference in the amount he charges for the package probably has something to do with the split that he negotiates from the club. Here the club would receive 30% of the amount he collected.

8)

You’ve hit on a classic: Growth vs. Value Investing. They are two different theories, one looks for cash flow and built-in equity while the other looks for appreciation. In this market I would be looking for cash flow. If you are not making money every month you can go broke waiting for appreciation that may be a long time in coming.

You may find an old blog post helpful:

http://www.biggerpockets.com/renewsblog/2007/10/23/growth-vs-value-investing/

8)

If the rehab was $12k the offer would look like this:

(ARV * 70%) – repairs = maximum price

($100,000 * 70%) - $12,000 = Maximum Price

$70,000 - $12,000 = $58,000

The holding, finance & sales costs are built into the formula. The contingencies should be built into your repair estimate. Of course, if you can get it for less great. The idea of the formula is to set the absolute maximum price that you will pay.

8)

Look on E-bay, you’ll be able to find a lot of stuff there for a lot less money. Spend time reading forum posts and be sure to check out the real estate investment blogs on this site (see tool bar on the left side of this page).

8)

Is it worth it? Maybe, he went on for almost two hours and it was pretty much a sales pitch for his boot camp.

I wrote about it in my blog post last week:

http://www.biggerpockets.com/renewsblog/2008/07/14/a-tale-of-two-real-estate-gurus/

He was guru number two in the story. He was entertaining and there is some substance to his talk. I had an opportunity to speak with him a little bit, seems like a sincere enough guy and he seems to have some good marketing techniques.

8)

I bought an REO from Citibank in the mid 1990s (seems like ancient history) and they provided the financing. The rate and terms were the same that they were offering at the retail level except that they waived a few fees. It was worth it because it would have been almost impossible to get conventional financing on this deal otherwise.

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