All Forum Posts by: Wesley Mullen

Hi Everyone, 

I've been dormant both online and in the RE game since we (my partners & I) got our first property up and running last year. With the new year, I'm trying to be more aggressive, active, and assertive both in both areas. Thus, I've spent time searching for and document absentee owners. I am planning on sending direct mail letters and was wondering what everyone thought about the best format. 

So far I have a list of 50, but that will grow. I was going to hand write each letter, but then got to thinking about handwriting one, and then copying it (of course hand writing the addressee/addresses). Or is it fine just to type the letters up and print them out? Not sure if it's better to come off personal or professional? 

Next, is it best to be short and too the point - i.e. I want to buy your house. Or more personal with brief background of who we are to add that personal touch? 

I'm not expecting to get much in results, esp in this first wave. But I'm curious what has worked for people in recent times? I've listened to the BP podcasts in the early days which talked some about Direct Mail, but I'm still in the 130s (so 2014/2015), so wasn't sure what today's standards are. 

Any recommendations or personal stories of success/failure would be appreciated!

-Wes 

I recently came across a Twitter post in which the individual was looking to purchase a home in Florida in the present market in anticipation of moving there several years down the road and thinking the local FL market being even higher at that time. His plan was to rent it out until they were ready to move.

This got me thinking as it aligns with my future goal to eventually move to FL (looking at you Tampa area) and was curious if this seems like a bold strategy or not? I do feel that the FL market will likely continue to increase over the years, so purchasing now would ideally cash flow as well as gain equity and appreciation over time. Dependent on location, this could even be a short term rental with higher cash flow than regular rent.

Good strategy or too much risk with unknowns?

@Brennan Hale

I'm a newbie too in that we just purchased our first property in Norman in February. I partnered with my brother and used traditional financing, so it helped being able to split the down payment. We also had an uncle who has been doing real estate help us along with the process. Since you're making decent money, I would recommend beginning to save up for a down payment unless you plan to pursue other creative financing options. I would also begin to let others in your circle know what your intentions are. MLS deals are hard to find. We came across ours by talking about our intentions with a friend from the gym. You're more likely to find a deal within your inner circle or someone they know. Also, I would recommend figuring out what your niche is. Ours is Buy and Hold. Perhaps you would like Flipping better or Wholesaling. Dependent on your niche, becoming an agent may or may not be the best choice for the long term. Wish you the best of luck! Also highly recommend the BP Podcasts of you haven't been listening- they are gold.

@Jordan Decuir

These are good points. That's an interesting concept about the borrowing from it and essentially paying yourself back in interest. I'm curious if others have used this tactic for creative financing as I haven't heard it come up before.

Overall, I appreciate everyone's insight. The consensus does seem to be continue to ride out the Employer match. Realistically/Regrettably I don't see myself leaving my W2 for several more years as were just a sapling in a forest of REI. If that time does come, I will look to move my 401k earnings into some type of Roth IRA account unless there are better options at that time. We'll see what the future holds.

@Mason Hickman

That does make sense. I know some people stop contributing completely and put that money in their own Roth IRA or stocks etc. I guess it depends on the average ROI?

As soon as I started my Corporate job, I was told like many others to max out my 401k contributions to take advantage of my Employer match (100% first 3%, 50% next 2%). So I've been contributing 5% the last 5 years. But in the last year, I've began investing in the stock market (index funds/etfs) and have started in real estate (we have one property under our belt). I am curious what others think about decreasing the contribution to 3% or even all together, as I have my mind set on the future through my other investing. The employer match is 'free money' but I'm wondering if I have make more through my own investments. Thoughts? What have others done who still work Corporate jobs?

Thanks for the feedback everyone! I do think saving and establishing processes and procedures it ideal right now. A BRRRR is probably not an option currently, as lacking the initial capital. So saving for when that opportunity comes or coming across a creative finance situation seems most reasonable. We are channeling our current cashflow into our Reserves for the property to help build a good rainy day fun. As far as house hacking, we're kind of doing that now in that me and my brother live together. It works out for the both of us in that I get to pay cheaper rent and they get a lower mortgage payment. So technically, my first house purchase was actually our first investment property! Never would have thought that in all my life leading up to this.

Hi Everyone!

I got into REI at the beginning of the year, partnering with my brother and his wife. Our initial goal was to purchase one property by the end of the year. However, after 2-3 months of researching/self-educating, an opportunity presented itself in that a friend from the gym bought a new house, but it was contingent on them selling their current. After running the numbers, we determined it to be a suitable first property that would cashflow ~$300/month --if we got the rent we wanted. We signed the contract in February, closed in March, and after minimal rehab, had a tenant in place with Lease beginning May 1.

During this time, I've spent time listening to the BP podcasts, reading books (Rich Dad is phenomenal), and we've been networking some too! However, now I have REI fever. I feel like if I'm not spending time searching for the next deal, I'm not working hard enough. However, I also think it's important to continue to save capital. I'd like to find a deal using creative financing, but also don't want to be stuck holding a property if we don't have the capital or reserves to properly work it. Basically, I'm so excited and intrigued by REI, I want to grow as fast as possible. But obviously cash (and deals) tend to limit the speed of this growth.

What do others do during their time in-between deals to be productive? What's a reasonable time between deals for a beginner? Or is it simply just continuing to look for deals and be creative with financing?

I should mention we are located in Norman, OK and pursuing buy & hold properties. Interested in what other newbies have to say! 

Hi BP fam!

I'm trying to do better about being more active in the forums. Since my initial post, we were able to acquire our first rental property (via traditional financing), do minimal rehab, list, and our tenant just moved in yesterday. The whole process took about 3 months from contract signing to tenant moving in. Now that the property is filled, I'm anxious to begin looking for the next. The biggest change we want to make with the next property is to avoid traditional financing - squeezing out the cash for a down payment and not being able to re-use it is not fun. We would prefer to BRRRR, but it seems that most people are doing this already and deals are hard to come by. Also, with material costs getting so high, I wonder if rehabbing in this current market is smart? Or would appraisals account for the increase in costs when it came time to refinance? Another area of intrigue is buying a property via seller financing. Listening to these cases on the BP podcast seem to be a good idea when major capital isn't available. Another thing that seems be popping up in conversations is that people are expecting a large influx of foreclosures once the Eviction Moratorium ends later this summer (anticipating it won't be extended). So would it be better to save capital and be ready to pounce on those deals? Curious to hear everyone's thoughts. If you want numbers of our first property, let me know! We are located in Norman, OK and bought less than 2 mi away from our primary.

Have a good weekend!

-Wes

Welcome Connor! We are in the same boat as you as we've been self-educating and are trying to acquire our first property. We were actually looking into the Lawton area as the houses seem fairly affordable for a BRRRR. I also have heard that the neighborhood really matters down there.. We also thought it may be better to stay local for our our first property, so we're continuing to look around the Norman area. As far as your question, be sure to look for any local FB pages, along with BP of course, and just reach out and ask! I've quickly learned the REI community is very willing to help each other out. Hoping one day I can give back myself. Best of luck getting started!