All Forum Posts by: Ronnie C.

I'm sure that this has been posted here already. I just want to share the formula to new wholesalers because I have been getting deals that don't make sense for myself or my investor clients and in order for you to get a good wholesale deal to your Cash Buyers you need to know this formula. It does varies depending on your market.  For this example we will use 70% 

For this formula you will need to know the following:

ARV=After Repair Value ( How much will the house will sell for after making all the repairs needed)

Repair Estimate - (Send me a message and I can send you a list I got from my mentorship class for ball park estimates based on square footage and depending if you need cosmetic repairs, avarage repairs or Extreme repairs)

Your Assigment Fee

ARVx.70 - Repairs - Your Assignment FEE = Max Offer

Example

$200,000 x .70 = $140,000 - $30,000 (repairs) - $10,000 (your profit) = $100,000 (offer)

Your potential profit is $10,000 

I hope this formula helps you make offers that will make sense for all involved in the transaction.

Happy Wholesaling,

Lily Rodriguez - Investor friendly Broker

Wouldn't the downside of doing any of those things be that if the existing owner gets any liens or judgments, they will still attach to the property? If so that's a big additional risk for the buyer. Also I don't think it's that clear that any of these tactics would actually prevent the bank from enforcing the due on sale. For example according to this, it seems that transferring the title is not required for the DOS to be triggered:

http://law.justia.com/cfr/title12/12-5.0.1.1.54.0.83.2.html

From the bank definition of sale or transfer: "For purposes of this definition, a sale or transfer means the conveyance of real property of any right, title or interest therein, whether legal or equitable, whether voluntary or involuntary, by outright sale, deed, installment sale contract, land contract, contract for deed, leasehold interest with a term greater than three years, lease-option contract or any other method of conveyance of real property interests."

That reads to me very clearly that the granting of any legal or equitable interest in or to a property secured by a mortgage can trigger the DOS, which would include any lease option, land contract, contract for deed etc. as it clearly states in the defintion. I'm not a lawyer or anything, this is just coming from what I've learned on here, there are many valuable old threads about this topic on here like this one:

https://www.biggerpockets.com/forums/83/topics/86029-subject....

and this one:

https://www.biggerpockets.com/forums/311/topics/183825-due-o..

How is it working our for you in practice?

They/"US Bank" took a house from me that had never been behind or late. By the grace of GOD the tenant/buyers were wanting out, and they had never been late or missed a pyment. Took good care of the property as well. 

 I told them they could stay there at no charge till the bank evicted them and made them sign a hold harmless. Thank GOD I didn't get sued! 

Oh I tried everything. Even my mentor at that time and this was 15 years ago, tried getting on the phone with them. He offered them several senarios like Pace talks about. They couldn't be reasoned with. They had no common sense what so ever.  He had over 120 houses sub to at that time as well, and was in complete shock!! 

I told them that it'd be over a year that they will miss this income/payments, plus added cost of attorneys, property management and selling fees. 

Over a year later it finally sold and they lost their BUTT!!! 

I will not touch another sub to EVER again. There is nothing like being able to sleep at night knowing I have title to my houses that I buy with cash or loans and no one can take them from me on a whelm. (long as loan is paid) 

By the way, I had this house 2 years at the time and the loan was low interest for that time. 

Don't say: it never happens, or it will never happen to me cause I have strategies around it! It can and WILL happen again. 

I still get sick thinking about it. 

Bob is running a real estate business.  It's completely unrelated to your question.  Flipping at scale is nothing like flipping without it.  It's comparing apples to orangutans.

Do not do this unless you're prepared to go there and get an established network, and can go back consistently. I've built a solid team in 3 of the cities I am in, it was a miserable experience at first.

Remote flipping for part-time investors is one of the hardest and riskiest strategies discussed on BP.  Heck, it's difficult in one's local market.

 WAY overthinking, how are they paid? Cash app or pay pal, who writes checks LOL.  of course not w2.  How did I build a team, I went there and built. I still remove and add contractors all the time, all remotely. Just this past week I took on two new crews, all went well. Next week I have them start (as long I close)  a 30k reno, while I am in FL.  Videos and photos to show the work.  Never lived in Cleveland. Materials, I have experience doing deals, also just go to HD, and get familiar. After a few you too will know what it will cost.  I know what repairs cost with labor. Its really not that difficult. There is not a book in the world that will provide reality, just like those dumb flipping shows on TV, not reality. 

Realtors NEVER use them, for the most part they are useless. All my deals are off market. 

All the best 

FL WAY overpriced, this bubble is going to bust, 900- 1200 a sq ft is INSANE!!  IMO do not buy 

 How?  Simple, not easy but simple.  I have a team in place in the Cleveland markets all while living on the beach in FL. When presented with an opportunity I have it walked typically within the hour or so, and make the offer as is. If accepted, which most are, I close. All work is handled. I than keep it for a rental or flip it to an OOS or country investor. I have done about 500 all while living out of state. 

Its ALL about knowledge and your team 

Good luck