All Forum Posts by: Derek Dombeck

@Matthew Michels

The challenge is not to find deals, because true deals are made, not found. The MLS is saturated with people looking to FIND a deal......

So, do the opposite of everyone else. You need to market directly to the homeowner. Get your phone to ring or get face to face across the kitchen table. Find out what they need and solve their problem. If you do that, you will MAKE deals in any market. A good friend of mine knocks on doors in neighborhoods he wants to buy in. 8 out of 10 homeowners invite him in. This is the first step to making an offer. 

You just need to stay consistent.

Happy Investing

Derek Dombeck

Why not look for people with smaller IRA's to borrow from? There's a lot of people that would love to lend on small deals like that. Go join your local Meetup or REIA and start telling people what you are seeking.

You need to learn the do's and do not's of private lending from retirement accounts well enough to educate your lenders. Equity Trust Company has a lot of info on their website.

Happy Investing

Derek Dombeck

@Steven Morris

You should be careful about getting short term loans because they will change your Debt to income ratio and then you may not qualify for the actual purchase money loan to buy the property. You said private money is not an option, but I don't think you should give up on it. The best thing to do, is get educated enough to explain to private lenders how you will protect their investment with you. Also, learn how to buy properties with seller financing or Subject To, or with leases and options. Knowledge is the key.

Happy Investing

Derek Dombeck

Both ways work. If you are making offers on listed property, that may make assignments tougher. In that case, use an established trust to make the offer.

Happy Investing

Derek Dombeck

@Dalton Foote

As a Mentor and R E Investor for almost 15 years, I can tell you the best way to find a mentor. You need to bring value of some kind to the person who's teaching you the business. I have had people pay me cash to teach them and I have had them offer their time as some type of labor. Either can work. 

The deciding factor of the students success is always their work ethic and drive to achieve their goals. A mentor can not supply either of those......... So what is your drive like? If you have reached out to a lot of people, don't stop until you find what you are seeking.

Happy Investing

Derek Dombeck

A 100k house that rents for $850 is a loss each month. We can buy houses for 30-50k that will rent for $850, but they will definitely be more management intense.

Happy Investing

Derek Dombeck

If you want to attach a line of credit to the property later, the bank will probably not issue the loan without being in 1st lien position. At that time, you could ask your seller to subordinate to a 2nd lien position. Obviously, they could say no.

What I like to do, is after making payments to the seller for 6-24 months, approach them and ask if they would be willing to discount my loan balance if I pay them off early. If they say no, nothing changes. I just keep paying as agreed. The beauty of seller financing, is it's easy to have a conversation with them after you build trust by making on time payments. And if THEIR life changes to the degree of needing a chunk of cash, they can and often will approach you with an offer to discount if you payoff early.

Happy Investing

Derek Dombeck

@Marlon Long

Something to consider.

I'm assuming the existing loan has been in place for awhile. So, you are realizing decent principal reduction with each payment made. Why not keep that loan in place as long as possible and try to find a private lender to put in 2nd position? There's a lot of people with small IRA's that would love to make 4-6% secured by cash flowing real estate. This way, you are not tying up your own credit or even personally guaranteeing anything.

Happy Investing

Derek Dombeck

You can purchase the properties in an entity, but when you refinance to pull equity out, it will be a commercial loan instead. This will most likely have a little higher interest rate and a shorter amortization. On the plus side, it won't show up on your personal credit report. You will still have to personally guarantee the note though.

Personally, I don't ever want to take the risk of owning anything in my name.....

Happy Investing

Derek Dombeck

@Greg Neuman

You won't need an attorney here where we live. Give me a call, I will let you know who to use.

Happy Investing

Derek Dombeck