All Forum Posts by: Trent Stone

@Nyasha C. Where do you find sample DM letters on BP?

@Houston Garcia How has the premium membership helped you in your business? What kind of activity have you drawn from it on BP?

100% Recommend "The Book on Estimating Rehab Costs" by J Scott.... Easily the best book I've seen on the topic. Follow the advice in that book and you'll sound like a pro and won't get taken advantage of. J is an expert and is super methodical. Their book on "Negotiating Real Estate" also has some great tips on getting contractors down. Get tons of bids, break everything down to line items and negotiate the best price for each. Make sure EVERYTHING is in writing, quality of materials, payment schedules, late penalties, etc. Only work with contractors that have great referrals and samples of work. If they say they did a certain project, you can get with the county recorder and see permits pulled and make sure they are in the contractors name. Even talk to the client and ask about the time of completion and the quality. Only give the contractor enough money to complete the next phase of work so you are never in a situation where they bail with your money and have to start over with a new contractor (I've seen it happen more than once). I know that's a lot to digest and it may cost you a little up front, but it will save you tons on the back end, and hopefully establish a great relationship with a contractor you can continue to use. Best of luck!!

Not really much info about the property. Unless it is a completely renovated turnkey, your repairs and capex are too low. I would probably dedicate a minimum of 10% between the two if it's in okay shape, otherwise a little more. Also, from everything I've heard from the east coast you should pay 10% for PM not 5%. For an investment loan you will most likely be looking at closer to 6% instead of 5%, you may be able to get lower if you are living in one and get an FHA. You should rerun the numbers with the higher estimates to see if it's a good deal, if the actual numbers come out better after you buy it then it's just gravy, but plan for the worst so you don't lose money.

Depends on how many contracts you plan on doing/are doing. I think that's where I would start then if you end up doing more than 5 contracts/month you can upgrade when you have to.

Nope... Depends on how much you use it but for personal use it's $10/mo. You can store documents and templates and stuff, it's really nice. 

https://www.docusign.com/products-and-pricing

Flipping Formula

(ARV x .7) - Rehab costs = Max Offer

(65,000 x .7) = 35,000 = 10,500

A 30k return on your 6k purchase price? If you are sure about your numbers it's a no-brainer. 30k for more expensive flips is a good return. Also, J Scott says he likes the total guts even more than moderate rehabs because you are already expecting the worst and you won't have any surprises. Make sure you have concrete bids for the rehab and you have a good contractor and your ARV comps are solid.

The house I'm living in now was a smoker house and the smell is hardly even noticeable now after a couple months. If I were you, I would replace any fabric, ie. carpet, I would pay a cleaning company a couple hundred buck to do a deep clean, change any HVAC filters, then I would go to Home Depot and buy an odor bomb or two. Air out the house as much as you can and get some Glade plugins for smokers and I think the smell will be gone in no time. I would use the smell to try and negotiate an even lower price though, most buyers will be thinking the same thing as you but I think the smell will be an easy fix, so, might as well use it to your advantage if you can. Just depends on the market and the seller. Best of luck!!

Our brokerage uses Docusign, I like it better than the other ones that outside agents send to us.

People do subject to sale all the time without being able to carry both loans, that's what the clause is for. As long as you have the subject to sale written in your contract you'll be fine, the mortgage company will only care about your back-end DTI at the time of funding and recording. Worst case, depending on how bad you want the house, you could get an interest only bridge loan from a private lender then refinance as soon as you get your first house sold. From what I see most of the time it's the sellers that you have to worry about. I've seen as many as 4 or 5 buyers' offers fall out because of the subject to sale so depending on your market some sellers might make you take it out or they won't entertain your offer. Just make sure you have a competent agent who can negotiate the subject to sale well with appropriate deadlines so you don't lose your earnest money in case you can't sell your first home.....Side note, we tell our clients to NEVER put down any hard earnest money unless they are desperate. Hope that helps, best of luck to you!!