All Forum Posts by: Todd Fox

I want to preface this post by saying that I fully understand that every partnership is completely different. With that said, what is a fair equity distribution for an investor that is putting up 100% of the cash and acquiring the mortgages. Other then some minor administrative work every once and while, that is all the investor would do.

Not sure how much of a difference it makes, but each investment is bringing in a 35% return on cash or higher.

Youre probably not going to be able to get a new mortgage if you have a bankruptcy on your record. Most traditional banks require 4 years of restored credit. FHA loans I believe are two years but you should double check with a local bank about that.

I believe the bankrupt will absolve your debt with both lenders (lien holders). With that said you can't do a short sale unless the lender in the first position is on board.

One piece of advice I can give is NEVER pay anything upfront or give an advance. Never get "behind" the contractor because it's hard to catch back up. Money is your only leverage so use it carefully. Also, always have a detailed contract. Add provisions and deadlines so that if the contractor doesn't hit, there is a financial penalty. I would also only pay on projects completed. Have the contract break down the price for each task, drywall, paint, flooring, etc. You only pay on work completed. Also, if you need to change something, get it in writing and use a change work order. The more organized you are, the more the contractor will respect you. Change work order

You should see if there is a land lord association in your area. Most of the landlords in my county sell to each other off market. Not to mention they will usually hold the mortgage and will ask for low money down!

One piece of advice I can give is NEVER pay anything upfront or give an advance. Never get "behind" the contractor because it's hard to catch back up. Money is your only leverage so use it carefully.

Thats good to know. I would be relying on my investors experience to help with construction. I have three people that Im working with. Two guys have over $20MM in their personal portfolios and the third has over $150MM. From a development standpoint, I wouldnt expect any fees, just a fee for facilitating the deal.

Thanks for all help!

Thats a great help, thank you. Ive done all my owns deals in house and just recently started working with investors, due to all the deal flow coming in. We are also doing much larger deals, which require outside capital.

I have another questions; is the 2% fee based on the purchase price of the lot or on the total construction cost of the deal. Some of the deals I'm working right now are redevelopment deals. The acquisition costs on one deal would be $850k but the construction cost would be around $7MM.

Thanks for the help!

How influential is this agent?  Are you currently working with other agents? 

I personally wouldnt pay the agent a thing!!! I also would not want to work with someone that doesnt have my best interests at heart. This agent is motivated by money, not by helping you succeed. Which means you're not the only buyer that they shop deals to. You don't need this person. Ive been working with the same agent for 4 years. We dont have any contract and shes totally content with us selling or buying with other agents. She values me as a customer and is happy to see me succeed. She views my relationship as a long term one. Your agent views you as a transaction. To make as much money off every deal possible. Cut him loose!

I would call every major real estate company in the area and ask to speak with agents that are experienced and high producers of your desired types of properties. I promise that you will dramatically increase your deal flow.

What is the typical compensation for syndicating a deal?