All Forum Posts by: Tae C.

@Lance Robinson

Great post Lance, very informative and great insight!  So to clarify, you bought these from a TK provider and by nature of doing so, paid basically full market value for these properties...and in a mere two years you were able to get pretty much all your cash Back out from that much appreciation??  Wow. Don’t hear that often with a lot of the types of properties people are buying from TK.  I have a flip going in Indy right now - what part of the city are you investing in?

@Ben S. @Jered Collins

Are you having to pay monthly both interest and principal, or is it interest only with balloon payment at the end of 7 years?  Is it run like a line of credit or do you receive one lump sum of cash right away?  If the former, how do you get access to the cash (via checks/credit card/etc)?  This seems like a great option. 

 Jay, any chance you could PM me some of those companies you mention?

Hello all,

Currently working on a flip, remotely, and just now realizing after my recent visit to the property that the current vinyl siding has all sorts of chips and bowing out on it that wasn't really addressed in the original scope. Yes, all sorts of misses there in the first place, but it is what it is and i will learn from it for next time. The house is in a revitalizing urban area, and the highest valued comps all have brand new siding that look like the hardi style. This project has had many overages already, with my profit becoming more and more of a question with each passing overage that comes my way... and now I have to determine if it's worth getting the new siding as well which i know isn't cheap. Honestly I don't even know if the current vinyl siding would pass FHA with as many dings and bows are on it, and the siding is too old to find a perfect match to replace just select pieces.

Questions: do I bite the bullet and replace it all completely, or try to find imperfect matches to repair?  If I do change it out, would you recommend fiber-cement/hardi or LP or what else? The best comps are in that style. And about how much can I expect to pay for 2 story 1800ish sq ft, “box” shaped home?  Lastly - do you typically have to pay separate for new siding to the painted?  Any input much appreciated!

@Dalton Smith

Thanks so much for that insight - I am right in line with all of that.  I think what gets worrisome for me is when I am always behind and having to front every phase in its entirety.  Appreciate opening yourself up for these questions!

 Yes, I guess you are right in terms of the chance for cost overruns.  I've had two primary residences built for me, all based on actual house plans I purchased, and though we had everything budgeted and the allowances set at the beginning, inevitably things change along the way.  

Either way, thanks for the insight - though I know several custom builders here locally, I never really have taken the time to ask them what kind of margins they are typically looking for...probably because most of them are friends of mine (and one of them built my current house) and that could potentially be somewhat of an awkward question for them to answer based on that relationship.  

 Yep, that makes a lot of sense to me - it's a very possible reality.  As others have stated, I always appreciate and respect the full, honest disclosure approach - and always great to see people such as yourself who have had great success doing it in such a manner.

@Jay Hinrichs

You mentioned talking about the idea of both profit AND loss when talking to the seller - I get the general idea of it but do you mind unpacking that a bit more?  What are you really hoping to accomplish by talking about the loss aspect of it - that you are still taking a risk in purchasing the property?

@Dalton Smith

Thanks so much for doing this!  Question regarding payment schedule. Let’s just assume both parties are new to each other. From your perspective, are you willing to be compensated for finished work?  Or do you require payment all upfront for each phase of work?  Or maybe half up front and half upon completion?  I am only talking about in phases, which again is just an assumption that’s how you work on a bigger rehab. I understand the tension of customers not wanting to constantly give everything up front for fear of the contractor having no incentive to work quickly, and even worse the possibility of them running off with the cash...but in the same breath the contractor wants to be certain that the customer is in fact going to pay, and pay in a timely manner. Curious your thoughts!

@Mike Wood

Ok gotcha. I was wondering more specifically what it’s like for people that are new home builders vs rehabbers, if you all approach it with a similar idea and looking for similar margins in mind in general...in essence, are you still typically trying to get your lot purchase + build costs between 70-75%-ish of the after-build value (not that that is a golden rule, but just for sake of sample) similar to a rehabber?  I would also assume you would typically have less to worry about in terms of unexpected budget surprises compared to a rehab, so it’s a bit cleaner when you project numbers than for a rehabber.