All Forum Posts by: Rick Pozos

I was in a similar situation a couple of years ago. I had two sisters and one wanted out, and one wanted to rent. I love my sisters and we get along great, I just did not want to be in business with them. I wanted to continue loving them, lol.  

The cash out sister took a note for one property from me, she took a note from her sister for the other property. Results, I have a property with a small note, my sister has a property with a small note, 3rd sister has a nice little income, and we gave her a little cash up front. We worked out the details of value, down payments, interest rates for loans, balloon, etc. and then put it down on paper. Everybody was happy and we dont own anything together. I get to do what I want with my property and so does my sister.

I agree, with all from Latara G. My best answer is to partner with an experienced flipper. If you can get a great deal, bring in someone who has done it and watch them do their magic. Help out in any way possible, of course, and ask questions all the way through the process. After you can say that you have one under your belt, it should be a little easier to find some money because you are no longer inexperienced.

I believe San Diego has several REIAs. That should be your destination for lending sources. I am sure that there are 20 to 30 people in each REIA that has money to lend. You dont need to buy a course on how to find lenders, I just told you how.

Also, you can do a search for San Diego here in BiggerPockets for other members in your area. You can see what they do. Some are going to be private lenders. Friend them and take them out to a nice lunch. If they cant help you, I am sure they have someone who can. How is that for free??

I would first worry about getting a deal done. An entity should be something that you start to think about after you have done a couple of deals. Focus on the property, ARV, repairs needed, contractors, and marketing strategy to sell. You already have enough to worry about without having to worry about entities.

With that said, yes it is a good idea to have an LLC or a C-corp, but you have to have money to set them up. It is good protection to have and I highly recommend them to everyone. I guess just not right off the bat. You do need to protect yourself from this litigious society that we live in. An attorney get get these set up for you, usually about $1,000-$2,000 for each entitly.

Curt is right. Most investors who are serious will have access to their own comps, they will know the area and they really dont want someone else telling them what they should be buying the house for. Now if you are dealing with someone a bit newer to the scene, then maybe you should put together a comprehensive package for them with pics, rehab estimates, ARV, comps, etc.

Me personally, I like to know how much you think rehab is, a couple of interior pics, my price, and how long I have to close.  Thats it!! It really depends on who your buyers are going to be, newbies or seasoned investors. With all that said, you really should be able to answer the questions that people throw at you about the property(what repairs does it need, termites?, rotten wood, foundation, siding, roofing, etc).

After you listen to the messages you will have a clearer idea of what to ask them. My icebreaker is usually something like, "This is Rick, I'm returning your call from yesterday, soooooo you have a house that you want to sell??" Straight to the point.

After they say yes I am thinking about selling, then I ask WHY are you selling(or thinking about selling)?? Let them tell you their life story or all the heart aches they have with their life. And why they NEED to sell.

Give them a person to talk to and that they feel comfortable with and if its a good deal, you will be the person they will sell to. Get to know them a little in addition to finding out about the house. It will be almost like being friends. People would rather sell to a friend than someone they dont like, so be that friend that they need.

Of course, make sure that the numbers work too!! If it is not a good deal, maybe you can refer them to a realtor. Again, be a friend.

Hard money lender, private lender, IRA lenders and partners are the ways to go. A private lender might be a friend of a friend who has some extra cash that does not want to only get 1% in a CD at the bank.

Quest is a company that has self directed IRAs. Some people use their money to buy for themselves, but some have this money and dont know what to invest in. You have to convince them that YOU are the one that they should invest in. They are going to work somewhat like a hard money lender, but there are usually no rules that are set in stone. Show your ability to pay back, and develop the relationship with the individual. There are other self directed IRA lenders, but I have found that Quest is very friendly and easy to work with.

When you have a deal, let someone else get the loan. You have to give up half the deal, but half of something is better than all of nothing!!!

Direct mail to find motivated sellers is great.  If they do not want to sell to you as the investor, they may want to list with you the Realtor. Either way, you win!! Maybe your business cards are double sided, investor on one side, realtor on the other. Hand out cards to everyone you know and everyone you dont. Tell every friend, relative, and person you see on the streets what you do. Business will come your way in no time.

Exactly. For single family, keep it simple. Are you buying it right? Is there cash flow? Those are the main items to keep in mind for single family and even for 2 and 4 units.  

Deanna, 

Did you get the house with the extra sqft?? Let us know what happened.