All Forum Posts by: Ryan York

Thanks @Arthur Lyons! 

Some more details: Market rent for the place is let's say 900/mo (very conservative).

My first offer to him was 40k purchase price with a 5k downpayment. 35k loan balance paid back over 30 years at 5% interest.

He countered with 40k pp with 10k down over 10 years with the no prepayment.

Hey all,

I'm trying to figure out how to make this deal work for us and the seller. He's pretty firm on a purchase price of 40k. It needs about 20k in repairs and the ARV is about 65k-70k (conservative).

He's open to seller financing, but we've never done a SF deal, so I'm looking for some advice on how to make a deal like this work, if possible. I know it's tight after repairs, but I also know that you can make these types of deals profitable if you're creative enough.

What do you think the best piece to go after would be (low downpayment, low interest, low monthly payment, longer term)? I thought about a 30 year amortization with a 10 year balloon or something like that. 

He also would want a prepayment clause where we can't cash him out right away to avoid the interest, so this would eliminate a refi as well.

Much appreciated!

We just closed on a tax delinquent property. Here in Michigan, the homeowner must be current by March 31st so we have a bit more time then 1-5 days obviously. I've never bought one that close so I'm not sure on that aspect. We always have the option to pay anyone's property taxes at any time. So in that scenario, you should be able to pay the taxes yourself to prevent the house from going to auction, however, you run the risk of the current homeowner not selling and you're out the cash. I would get an attorney involved and verify that the current homeowner is somehow bound to the deal after you've paid the taxes. Regarding who pays the taxes, that's up to you. In our case, we offered to pay the taxes and just worked those numbers into our offer. In a lot of cases the homeowner in this situation can't afford them, so it makes the transaction easier if we pay them. This was done through our title company after closing.

Anyone have any tips for finding vacant house insurance in Macomb County Michigan? 

@Ethan Summers lol right on. Do you have your callers read from a script? Are you just looking for basic information about the property or do you have them go in depth into motivation and what not?

@Keri Middaugh Ha thanks Keri. When you look at it that way it is a little reassuring. Sometimes I feel like maybe we're just bad negotiators though lol Congrats on the 3 deals! 

@Ethan Summers That's a great tip. We don't do much cold calling as I've read mixed reviews on skip tracing related to the expense and time required, although now that our DM budget has taken a big hit, we'll have to go back to trading time. Who do you use for the skip tracing and how much is it? 

Secondly, what's your strategy for calling? Do you call before or after the post cards hit? Do you mention the post cards? Do you discuss how you got their info or why you called them? What types of sellers are you calling, i.e tax delinquent, absentee, probate etc? Lots of questions lol

@Terry Flynn  I've read it. Great recommendation! 

@Jay Hinrichs That's good to know. Bank owned or no? 

@David Faulkner I agree. They've been hit somewhere between 5-8 times depending on the property. We did try yellow letters a couple of times and I didn't see any different response rates, so I went back post cards. As far as deal structuring goes, have you done anything unique? 

Thanks for all the responses! Sometimes it's nice just to get a fresh perspective and hear someone else talk about RE. I'll respond to each of you guys... Also, I should've mentioned that we do have a rental property, so we have that under our belt. We didn't have to do any work to it though and we inherited the best tenant on the planet lol So we don't really count that one. 

@David Rawls = my partner

@Marcus Auerbach I've thought about us missing deals hundreds of times! This is probably the reason we're spread too thin if that's the case. We've been working harder on monetizing every lead because we do get a lot of response. We just can't ever seem to land a deal for whatever reason. So we learned about lease options, notes, seller financing, yada yada. We'll have to reassess a little bit and see where we an really hone in. 

@Ryan Smith Yes we have. I forgot to mention that. I comb the MLS every day or couple of days. We've made lots of offers. Had a few counters but no deals. Do you focus on bank owned properties only or doesn't matter? Also, do you have an offer target per week or anything like that? For example, you try to make an offer per day, which typically yields 1 deal per x amount of offers. Do you go and see every property you offer on? If not, do you use a rule to make offers? Any strategy tips would be much appreciated :)

@Chinmay J. For flips, we try to stick to the typical 70% ARV - minus repairs and other costs. We've even tried going down to 80%, and we've also tried a fixed profit target like 15k or 20k. For rentals, we try to use the BRRR strategy so it's pretty similar. Just haven't been able to get the right price. What criteria do you use?

@Brent Maxwell amen man... it'll pop off sooner or later! 

@Svetlana Foley Speaking of getting started, we actually have this little 2/1 700sq ft under contract for a few thousand bucks. It needs work and I don't anticipate making much more than a few thousand if that, if we went through with it, but I thought there might be value is just going through the entire process, working with contractor, selling, etc. and saying we actually completed one. What's your take on that?

@David Dachtera I agree completely. I am a believer in us investors being "Transaction Engineers." I forget who coined the term but I think it gives us a good chance to be successful when we can make it about helping every lead somehow. Although, I'm not currently making a good argument for myself :) 

Hey all,

My partner and I are staying positive and continuing to chug along, but we still haven't landed our first flip after about a year. It's getting discouraging! We're certainly not going to give up, but it'd be great to hear what's working and what isn't for other people out there. 

Here's what we've been up to:

We were sending out 1000-1500 post cards per month to owners who were delinquent on their property taxes and coming up on foreclosure (they were in forfeiture in Michigan). That was an epic failure! 

We've looked at dozens of properties, and we talked to a lot of leads, but didn't get a single deal out of it (yet). We had several fall through for odd reasons... found some things on title research.. had a guy shoot up with a dirty needle and almost die... got threatened a few times lol. 

All in all, we did gain a lot of experience, but without a deal, it's a motivation killer. We recently had our money guy go on hold due to the purchase of a million dollar property so that hurts as well moving forward. 

We also have a website that's generating some traffic, and we have Adwords set up as well. These leads have proven to be motivated but they're few and far between for our location in Metro Detroit, Michigan (not the city of Detroit). No deals there either.

We also make offers weekly on bank owned properties, but haven't been able to get one under contract there.

I'm a firm believer that there's always a way. There's people out there making big money right now, so timing is no excuse. What are we missing? 

What's working or not working for you guys? Misery loves company so if you're having a bad go of it, feel free to vent as well! 

I've been looking for ways to monetize similar leads. Have you pursued this at all? Would love to hear an update.