All Forum Posts by: Stephen Talaber

So I have a bit of an interesting situation. My friend’s mother lives alone in a house that is way too big for her, she needs to get out. She is having trouble making her mortgage payments and the condition of the home is slowly getting worse. In order for it to sell it needs some money put into it, which she doesn't have. She is a little behind on her mortgage, how much I don’t know. I have an appointment tomorrow at 3 to talk with her. I would like to find a way I can help her out of this situation.

One of my ideas would be for me to do the renovation and carry that cost until closing. How I in vision this working is that she would retain ownership of the home and give me permission to do the Reno. At closing she would pay off her mortgage and pay me for the work that was done. I make profit on the Reno and she pays off her mortgage so it is a win win.

I know it won’t be that easy and I don’t even know if this is remotely possible until I find out what she owes on the property.

My question is if we were to do this, where I pay for the Reno to get the home sold, how does it work at closing? What is the mechanism I can use to get paid at closing, for the work that was done on the property? Would I have to put a mechanics lien on the property to make sure I get paid or is there another way? Could I just have my lawyer draw up a contract dictating that I get paid at closing?

I would like to have some idea of how this works before I go and see her tomorrow.

Any help would be appreciated

Steve  

@Alvin Neal Great post. I do 5-10 flip estimates a week, this will be very helpful. The life expectancy chart is a nice to have as a reference. 

@Jeff Plair I knew you had it figured out! 

@Stephen Fryer I have checked homepath.com but have not seen the other two sites. I will be sure to add them to my daily search for homes. 

Post cards and yellow letters will be my next step, I think its a great way to go. There are so many different ways to get lists of distressed homes. Have you seen any success with your letters? How are you obtaining your mail list? 

Feel free to direct message me if you would like.

Thank you for the help 

Steve 

@Jeff Plair  Got it, seems to me that this could be a little risky taking his word for it. I'm sure there is someway to check, maybe at the county clerks office, just to make sure it is free and clear. Until you see the property and decide if it is for you this extra research is probably unnecessary. Thank you for the response. 

@Jeff Plair It is great to see that direct mail is working for you. I am new to REI as a whole but am looking to get into my first fix and flip soon. Searching MLS hasn't worked all that well for me yet and direct mail is my next option.

I like the technique you used with driving around looking for distressed properties then sending them a hand written letter. Using a hand written letter definitely will get much more notice then using a standard printed letter that people will typically just throw out. (They might just throw yours out as well but hopefully they will actually read it) 

I can relate to how you felt with that first call. One of the reasons I haven't used direct mail yet is the anxiety with getting the first call. I know I can handle it but there is always the fear of the unknown when trying something new. 

How were you able to find out he owned the property free and clear? 

Thanks for the responses everyone.

@Vala Shahabi I will be sure to check loopnet.com out today, I haven't heard of that site yet. 

@Amicia Mussenden Yes I understand MLS is not always the best source. The problem I find with MLS is that there is just so much competition. Almost every investor in the area has an agent checking the MLS, just like me, looking for deals. So it is hard to find good deals. I wont give up though!

@Dmitriy Fomichenko thank you for the help, I will be sure to save some keyword alerts 

Good afternoon my name is Steve Talaber and I am brand new at this whole real estate thing.  I got into this by "accident". 

I have a background in construction both commercial and residential. Construction wasn't really making me happy so I decided to get my RE license. I became a part time real estate agent with practically no success. I became a little discouraged and focused back on construction.  I applied for a new job as a project manager. While at this interview I met the owner of the company I was interviewing at. We by chance got into a discussion about flipping houses when he saw I was licensed in real estate. We both had an interest in pursuing fix and flips. He encouraged me to write a business plan to flip and present it to him. 

4 months later here I am. Now I work full time researching properties to flip and to continue to develop the business model.  Its a decent situation I get an office, small salary and they have agreed to be my "investor". 

I spend most of my time searching through MLS sometimes I use hubzu.com and auction.com as well. I have probably looked at 30-40 potential properties and put offers in on 3 so far no luck though. I need to find a better way to bring in motivated sellers. This seems to be the biggest challenge to me is finding properties, especially with the margin of profit my investors look for.

I have learned a lot using this site the past few weeks. The flip analyze tool is helpful (the main reason why I joined) as well although sometimes the math comes out wrong. Anyone else encounter this issue?