All Forum Posts by: Rick Stein

Move on. They seem like trouble. I learned early on...having no tenants is better than having a bad tenant.

Hi, Russ,

Some options would be to bring in a partner, private $$, seller financing for you. How bad is their credit. I believe FHA has a threshold of 640 fico. The bigger question may be why you are getting only buyers with issues. Where is this property? Is it in a neighborhood that invites this type of buyer? Just a thought.

Good luck

Welcome! There is NO need to spend $20-$30K for their course. You need education which costs very little. You are already on Bigger Pockets. Join your local REIAs (Real Estate Investment Association). The cost is nominal. Read books. Find a local successful, experienced investor and take him/her to lunch. Hang around successful investors. Learn your craft!! Eventually, you will need to take the plunge. You can't be a professional student (always taking courses, never investing). You can start small with a small single family or two family. Keep making offers until someone says "Yes". Education is power!

Good luck

There have been many responses, but I'll add my two cents.There are deals everywhere if you know HOW to look for them and what to do with them when they appear. On a buy and hold, the price is secondary. Terms rule. Is seller financing available? If it is, you can craft a deal with the seller that makes sense to both parties. For example, I just penned a contract on a three family in Trenton, NJ. I am purchasing the property for $110K which is just about market value based on the rents and cap rate for the area. BUT, I am putting only $10K down (less than 10%) and amortizing a loan at 2% which will be paid off in about 12 years. Why would the seller agree to 2%? He has agreed because he wants out of the property in the worst way. The interest rate is not important to him. What is important is getting that gorilla off his back. 

I am closing on another deal with a purchase price of $75K. It needs about $12K in rehab. I am borrowing $90K from a private investor for three years at 5.5%. The ARV is $140K so the LTV is about 65%. I will have a positive cash flow of about $400/month. It is a win-win for all concerned. I am not saying this to brag, but to impress upon you that you must think creatively.

If you do not understand creative financing, I suggest you read some books on it, read the forums on BP, join your local REIA and get educated.

I wish you the best of luck!

Since I am a real estate broker, I list my rentals through my company. I also put them on Craiglist and post them on Socialserve.com which indicates I accept people with disabilities, Sec 8 etc. the problem is not getting prospective tenants. I am usually inundated with applications. The challenge is getting qualified tenants. You have to be very careful in selecting them. Having no tenants is not nearly as bad as having a bad tenant.

I own several properties in Trenton and I'm under contract that buy another. Trenton, due to the low cost of the properties, can give you great cash flow. However, I will not buy in a " war zone". It is not worth the aggravation. 

By the way, I have several section 8 tenants and I will accept a Sec 8 tenant every day. Of course, I want to meet them and " get a feel" for the type of person they are, to determine if they a person of good character... whether or not  take care of the property is my main concern. I know a lot of landlords frown upon Sec 8 tenants. My feeling is that simply because someone is low income does not make them  irresponsible. I know this goes beyond the scope of your question. However, if you are going to be a landlord in Trenton, you most likely will deal these folks. BTW, it is illegal to discriminate against them as you can not discriminate based on source of income. So, if a prospective tenant asks you if you accept section 8, you can not say " No, I do not!" You can refuse them for other reasons though.

I hope that helps.

Good luck!

it is probably  in Trenton. Am I correct?  Just because a property is inexpensive, that does not make it a good or wise purchase. If the area be a that distressed, you most likely will get tenants who can not live anywhere else. My advise is to stay away.

Jorge,

 If you can find a property that involves long term  seller financing at an attractive interest rate, you then not only have an attractive property, but also attractive financing to assign. The financing can be equally as important, if not more important than the brick and mortar. For example, lets say you can negotiate 10% down with a long term note at 4%. This would be very inticing to another investor. 

How many letters have you sent out? If you are sending out a massive amount on a consistent level and not getting any results, there is a problem. Why do you have nothing to show for it? Have you gotten responses? What are you saying to them? I don't have enough information to comment.

own each property free and clear? Pay cash for all of them or am I. Is understanding you?