All Forum Posts by: Tom Mole

@Justin Green, I would echo everything @Curtis Bidwell just said. 

Your description of this tenant sounded like you were asking for others to validate a decision that you've already made. If you want to take the risk of renting to this fellow, then by all means, do so. It's your property. Things might just work out fine. It's your business.

On the other hand, this is your BUSINESS. Treat it like a business. Is it your business policy to accept security deposits in installments? 

Have you looked at @Brandon Turner 's "Tenant Screening: The Ultimate Guide"?

I hope I don't sound too nasty, but you asked for advice and I believe you need it in this case. Sorry. I hope this is helpful.

All the best.

@J. Brian Walters, why do you want these properties. I'm sure there must be a compelling reason that you haven't discussed. Why is there anything in the contract that you are unaware of? Have you made a formal offer yet? Remember, in real estate everything is negotiable and nothing is settled until the contract is signed.

Why don't you take a step back. Figure out what you're willing to pay and under what conditions. At what point does this project stop making sense? Has the seller already crossed that line? You need to know what your maximum allowable offer is. Your offer is not just a price, but price AND terms. 

I suspect that you've been talking to the agent who has made you promises. The seller is probably just starting to negotiate and you're thinking the agent is "on your side". Normally, the agent is paid by the seller and so has a fiduciary to get the best deal for the seller. You're on your own, so don't fall into the trap of thinking your agent is your buddy.

Only you know what you need to make this deal work. Once you draw that line, stick to it. Make the offer so that you understand and agree with every part of it. If you can't get the deal you need, be willing to walk. Another deal will come along.

I hope this helps. If you have any questions, feel free to contact me.

All the best.

Welcome @Tony Coiro to the BiggerPockets community! Have you had a look at @Brandon Turner's ebook, "The Ultimate Beginner's Guide to Real Estate Investing"? It's FREE and it's a great way to get started. 

You should contact me sometime. I'm in the SF valley area, but I love to talk investing (as many of my unfortunate friends can attest.) I adore coffee, I enjoy beer and I'm stranger than most. 

I have a friend who runs a Cashflow club in Torrance. I think you should talk to him. Have you ever played the Cashflow 101? Let me know if you might be interested.

All the best.

@Brittany Thompson  in terms of learning and applying techniques to wholesale property I agree with @Dave Savage. I'd like to look at another facet. Why do you want to wholesale in the first place?

I ask this all the time of the new investors. The problem I find is that they are only looking at the low barrier to entry. They've been told you can invest with no cash and no credit by flipping purchase contracts. What they were not told is that wholesaling is not easy. It can be remarkably discouraging. It usually requires the broadest knowledge of RE investing strategies and strong marketing skills. 

There are always exceptions. Some people just take to it naturally and do very well. Perhaps that's you. If so, read no further. You'd do quite well with the suggestions Dave offered.

However, if your investment objective includes something more than just trying to make a quick buck, I recommend you consider wholesaling as a backup strategy. Let's say you figure the big bucks are in rehabbing, but you haven't got the money in the bank that business requires. No prob. You go out find a great looking deal, calculate you discount of ARV (After Repair Value) and subtract repair costs then reduce your offering by a little more to cover your assignment fee and submit your offer. The only problem, another rehabber saw this deal and offered the same amount you did plus the amount of your assignment fee. His offer got accepted because he could offer a little bit more.

I could go on with the scenarios, but the point is this, what if you could structure the deal to use Other People's Money (OPM), instead? Consider, same house, seller has 50% equity in the property and you now this because you skilled asked him. You find he will "carry-back" and you purchase the property "subject to". You offer top dollar and close with no money out of your pocket. Easier said than done, but at least now you're competing in the marketplace.

OK, so there's a lot more to it than what fits in this tiny post. I just want to face you (and hopefully others) in another direction. If you have any questions, send me a colleague request. I love to help the new folks. It makes me feel like a guru.

BTW, since I started writing this post,@Will Barnard posted in the Wholesaling forum. Check out his post,

The Truth About Wholesaling!

Very much the what I'm talking about from another angle. The man's a genius and well worth taking the time to listen to.

All the best.

@Jonathan Schwartz I've got to agree with everyone else here. Your deal seems scary thin, but you an advantage! You need outside financing to take this project on. Your money people apt to tell you no based on the numbers you've shared. If they start lowering the LTV after vetting tbe deal, you know there's a problem.

Most of sunny So Calif is as hot as MA. An offering like the one you described is typical out here. I'd kick rocks on it. Too thin, too risky, not enough upside potential.

If you've never done a project like this, please partner with someone who has. Toss me an email. I know a realtor/investor that may want to contact in the Boston area.

All the best.

Great point about the refrigerant! That never occurred to me. I.m gonna keep that in mind going forward. Muchos thanks! Here in sunny So Cal that's a big deal, especially in the valleys.

I don't worry too much about heat pump systems. I just keep a. eye on the guy brazing the lineset. There a couple of guys I'd trust. Everyone else gets eyeballs over their shoulder until they're vetted and then I still want an ironclad warranty. Just saying.

Generally I'd run linesets outside the exterior siding then unsoffitted through the attic. I'd never sign off on a job with a kink and I'd need to see whole line for that. This policy generally precludes nail and screw damage at installation and into the distant future.

Again, thanks the heads up. You are my new guru of HVAC!

All the best.

@Samuel DeMass with all due respect, your spreadsheet doesn't help much. Its an unfortunate mix of apples and oranges (with a couple of grapes thrown in). Please annualize everything. A monthly cashflow next to an annual NOI means I've got get a calcator and sheet of paper. (Not gonna do it)

Next, what are your investment goals? When Kiyosaki asked his rich dad "is this a good investment?" he got the reply "I don't know. Are you a good investor?" Are you looking for duplexes? Are you after cashflow or capital gains? If the numbers (after being annualized) what you're looking for in a long term investment? Do you have a buyer looking for those numbers? What sort of financing can you arrange? Would the seller help with financing?...and so on and so on.....

I hope this helps. Don't be discouraged. Just sharpen your pencil (or spreadseet) and vet the deal again. We all do it. I love to see an update, if you get a chance. Pop mail an email if you'd like.

All the best.

@Phillip St. John I clicked the link. The photos showed a place in fairly deep distress, then I noticed they were apparently taken nearly a year ago. What might have happened since then?

If I were you, I'd go visit the property and make sure it's still there, then I'd peer through the windows. At that price point ($49k) repairs could easily exceed the purchase price. Just saying. 

All the best.

@Guillermo Barrantes  Welcome to the BP community! Congrats on your first purchase and your ambition to expand your empire. 

Read the Ultimate Beginner's Guide to Real Estate Investing that @Tim Coppola  pointed you at. @Brandon Turner wrote this excellent work and graciously offers it for free to the community. What a guy!

I live really close to you. I could suggest a bunch of great REIA's near you where you could meet other investors and learn how to do what they do. Personally I'm a big believer of Cashflow clubs, particularly for newbies. If you're serious about wanting to get started, there hardly any more cost effective way to start your investing education. There are few Cashflow clubs in the valley. I hope to see soon at each of them!

Let me know if you would like any help getting started.

All the best.

@David Hartoon, you may be hunting unicorns, but if you don't have a budget, then you don't have a budget. It's time to get creative.

First of all make sure that you know what you looking for. If you don't have money for marketing, I feel safe assuming that you don't have money to make the acquisition on your own. Talk to your cash buyers. Find out what they would like to buy, then go hunting.

Let's say you know what your looking for. Now whenever you're not home keep your eyes and ears open. You see a neglected yard, bad roof, peeling paint, etc. you make a note and follow up. Find the owner and ask him if he'd like to sell.

If you can raise a little money, buy a a few hundred business cards that say something like "Having a yard sale? I'll buy your house too!". Be creative or find a creative person to help you, then start having conversations with strangers (despite what your mom taught you when you were little). When that stranger asks what you do for a living tell that you buy house and hand them your card, then tell them that you pay referrals and if they happen to know anyone.......

Get a Google Voice number and use that in all your marketing. It's free! When that number rings you'll know that the call is coming from your marketing campaign. If it doesn't ring enough, you need to up your marketing game.

Seriously look to get involved in your community. Join the Kiwanas or Toastmasters, things like that. Volunteer to help put on the community lalapaloosa or whatever. Make a lot of friends, ignore the pissie people. Community involvement will help you become "known" in your area as a "great person". You'll make a lot of friends to strike up conversations with that will ask you what you do for a living. Each one gets a card. Pretty cost effective.

If you really put your heart into it, you'll think of lots of things you could do to get the word out. You live not far from @Brandon Turner, right? Perhaps you could ask him what works best in and around Seattle. Whatever it is work it and never quit, never slow down and especially never let discouragement keep you down. Remember, there's no crying in real estate investing! If you hunt long enough and hard enough, sooner or later you're gonna tag and bag that unicorn.