All Forum Posts by: Stephen McKee

Some offices have gotten so busy that they forgot to higher buyers agents. The phones just ring and ring but no one is there to pick up the calls. To reiterate what was already said, "get an agent".

I would suggest buying some properties to develope a strong cash flow and then helping out other people. One of my end goals is to help people become financially literate. After you have a strong enough cash flow you can buy a small apartment unit and trade rent for equity.

IE: If you are trying to buy pre forclosure, the biggest hurdle is where the sellers are going to live. You can move them into an apartment you own with the rent paid for for X amount of months and give them some cash. This way you are helping them get on there feet, giving them a place to live, and you can even spring for a financial teacher if you want.

In this case everyone wins. You make money off pre forclosed houses and the seller has a place to stay with a really strong head start.

It's good P.R. too.

Find a lender and make sure he will lend to you if the deal is right. When the market was hot out here people were paying...

3 points up front.
14% per month for 9 months.
3 points for a 3 month extention.

You will also need plans, prefab plans should solve that issue easy.

Find a lot with the proper zoning.

Call the HM lender to approve it 24 hours.

Submit offer.

YES and No

Sales volume is increasing but sales prices are not. My gestimate is 1st QTR 09 will be the worst and best month in our market. We should see stabalizing prices and major increased volume.

This is what we call a false bottom. Agent start getting multiple offers on 10% of there cheapest inventory and they think the market is turning.

We are one of the biggest REO offices in our area and our pipeline is scary huge. 200+ listings 100+ escrows and 400+ properties in the pipline. By the ime those and the others to come hit the market the prices will have to level out.

People like living in California and California homes are getting cheaper by the day. If you sell it (cheep), they will come.

Inland Empire here, the land of bro's and soccer moms reporting in. No REI clubs out here though. Alteast no goods ones. I'm up for some networking if you have investors looking to cashflow.

It's 12:30 am PST and your mad no one is up to respond to your posts.

Conv + HML

I have a HM Lender in town that will lend you your down payment and rehab money but he needs another property to lein.

For example: You live at 123 main street. You owe 200k on it and it's worth 300k. He will lend you 100% of your current homes value to make the down payment an repairs on the new property.

This is an unrecorded note. You will get the funds prior to COE. Put the cash down, do your rehab, refi, and rent.

There is another option. Another broker on this website hipped me to this company that lends based on ARV and 6 months of payments can be built into the loan.

http://www.brookviewfinancial.com/index.html

On to cash flow

This is why I love the Inland Empire, mostly Moreno Valley. People here were so stupid that they were buying 3 homes at a time from the builder and letting them just sit vacant for a year and trying to sell them for a profit. Some people got rich and lots went bankrupt. This led to an artificial demand so high that Moreno Valley actually ranked at some where around the 3rd fastest growing city in the nation. So to get to the point, our values went from around 300sqft to 135sqft in 1.75 years. Shocking isn't it. At this time 8000/58000 homes are in some stage of forclosure.

Moving on to cash flow...Because of this mess we now have a huge number of people that need a place to live. You can buy a 1980's (lowest tax base) 3/2 1000-1500 sqft for 150k or less. Average rent is 1400-1600. My suggested rent is 1350. Even after purchase/rehab/refi you still cash flow. Tommorow I am puting a house like this in escrow for 95k. It needs a 30k rehab but it will cash flow 300-400 a month. These next couple years here are going to be awsome. Cash flow + major appreciation in the future.

I love my hopeless little city. Been here my whole life and I see no reason to leave $$$$$$

If this works see my purchase price index attached.

REIUSA

You bring up a good point about a heloc. There are several sources of additional income to rehab and rent. Heloc's and stand alone 2nd's are the #1 source if possible. Credit unions smoke everyone else's rates on heloc's but most will only use your primary and secondary residence as colateral. These should be set up before you even start shopping.

Also...They are also a great source for for missed rent payments.

I love door handles. You can just take a hammer to them and they fall right off. All of our rented REO's have had new front door locks. All the side doors were not rekeyed. The front lock must come off even if they have the combo because the lock box shackle has its own key.

Latly a few of our REO's have become rentals without knowing it.

Every once in a while we will get a property a little out of the way and we only visit it once a month. These properties are usually the victims.

1. Our sign is removed.

2. A for rent sign is put up with a prepaid cell phone # on it.

3. A tenant signs a lease with this unknown "land lord" and tells them all the utilities are included in the rent.

4. We get an electric bill for $300. When utilities are included these people really crank the a/c.

5. We visit the property and find very pissed off tenants. One guy even paid 6 months up front because he told the "land lord" that he had really bad credit.

We have had more than 10 like this in the last 6 months. We do have over 500 REO's but wow, these guys are a-holes.