All Forum Posts by: Shannon K.

@Account Closed, I'll bet you its something like that that happened cause I was asked to submit a highest and best by 4pm the next day. I ended up withdrawing my offer. It left a bad taste the way it happened having no offers for 6 months and then multiple offers the same HOUR I submitted mine.

So far the construction side of things is more fun for me, lol. I notice that the business end of things seems a bit fickle and its hard to trust what some others say/do. I know my realtor from years ago and know he's a man of ethics and integrity so working with him now will hopefully yield better results than what I first experienced on my own a few weeks ago.

@Mersades Williams, its the "Rehab Analysis Spreadsheet - Basic" file J. Scott generously uploaded for us here on BP.  I just adjusted it in Excel to fit my needs:  

https://www.biggerpockets.com/files/user/JasonScott/file/13-rehab-analysis-spreadsheet---basic

Hey @Steve Vaughan, could you explain what does "being shopped" mean or/who is doing it? The first property I went to view sat for 6 months and the exact day I went to view it, 5 people showed up during my showing and within the hour I was there, there were 2 offers plus mine. Plenty more happened which made it a bad first experience and very "ironic" so I was wondering who does this type of thing?

@Mersades Williams, I have been preparing to purchase a property and educating myself for nearly 6 months now. I have a very investor-friendly agent and we've just begun seeing properties the last 3 weeks in January. I've seen 3 houses thus far and in real life they were much worse than pics online indicated. I feel excited to get a property soon, but you always have to remember don't let your excitement cloud your judgement. The numbers don't lie! At times I was very excited to see the houses that I felt myself "convincing myself" I could make it work. I brought my spreadsheet with me and began estimating the rehab as we walked the house. This kept my excitement in check. Don't rely on emotion when you start doing deals.

I definitely agree with you @Sean Blomquist. I've always thought HML required such high interest rates and points to mitigate the risk of people having bad credit, no money, little experience and they want to get into the game with few other options available to them...

I have good credit, cash of my own, and a partner that does 50-60 flips per year for the company he works for and I can't find a HML that doesn't require 20% down yet. I've had 7 long phone calls with HML this past two weeks and so far 7 out of 7 of them are requiring 20% down. Every deal I've brought to these lenders is right at 65% ARV (which does indeed cover my purchase and most repairs).

I planned to retain some of my own cash for contingencies/closings/interest payments/starting the rehab... but so far I'm meeting this 20% obstacle at every corner. I feel like I'm dealing with a bank with this 20% down business. I'm not sure what I'm doing wrong here or if lenders in NY are more stringent?

This is a good question, I'm glad you asked. I've been wondering that myself after putting 20% down on the house, how do I now start the rehab? I know construction draws are done after periods of time with the hard money loan, but if I've used my initial 20% down to purchase the house, what's left for starting the rehab?

When a HML asks for 20% down and I agree to that and show bank statements, its really actually more than 20% up front because I now have to front the rehab costs as well? I'm still in the process of talking to lenders, but from how they're presenting it to me, its more than 20% needed up front... Please correct me if I'm not understanding the process right.

I would rip out the carpets first. Have the roaches professionally treated cause then most companies have a clause that re-sprays are free if they don't get them all the first time. Wipe/wash the walls, have the maid service come in...  Like @Donald Howaniec said, if the smell is quite bad, rent an ozonator from Home Depot, set it for a few hours and get out of the house til its done (it can cause respiratory issues with people and animals/wilt plants).

An ozonator machine will produce O3 (ozone) which when plugged in, utilizes electricity to sanitize the air. Normal oxygen (O2) you breathe in your house is transformed into ozone (O3) via the electric current. Ozone is basically "activated oxygen" and because it has a 3rd atom, its now capable of pulling odors and junk from the air. When the ozone (O3) breaks back down into normal oxygen (O2) that we breathe, the extra oxygen atom of O3 leaves with the odorous junk trapping it in the filter of the ozonator machine. It "oxidizes" the pollutants leaving you with fresh O2 to breathe and no smells!

Oh goodness, I guess I did pay attention in organic chemistry class, lol.

I am in the process of presenting my first few offers on houses now and I presented solid deals to a few lenders the past week... Yes, I did all the running around first to create a 10 page proposal detailing my experience, the properties, the numbers, comps--everything I could think of, and submitted to HMLs. I did not have the properties under contract yet, just an idea that I wanted to go after them. (To move forward past the pre-approval stage to get the loan, I would need them under contract).

In turn, they offered me a pre-approval letter without me even asking. Two pre-approval letters were property-specific from 1 lender and the other lender offered a "blanket" letter which pre-approved me up to a certain amount, but didn't list the specific property. Though this isn't a guarantee of lending, I was able to begin bidding on houses without them being under contract yet. If those deals didn't work out, I am still already in the lender's computer systems pre-approved for deals when I find the next one. (Unfortunately, I'm choosing not to use the HMLs I've contacted thus far because their numbers magically changed from what they originally told me once they realized I had more money available to put down, yuckkk).

@Michael C Gregory,  @Patrick Soukup is the OP sending something out to you for review...

When I made my packets, it was for specific properties. I have a blank document saved so I can easily pop in the new numbers, grab pics in put them in the same spots, and then change it to a .pdf file.  In my case, the two properties I prepared this for turned out to be blahhh and upon seeing the inside with my construction partner we didn't end up wanting them, but I had the packets and pre-approval letters nonetheless.

I do think I may switch my routine going forward and that it may be a better use of my time to have the property under contract first before I make up such an extensive proposal packet though...