All Forum Posts by: William Jenkins

Not sure why you are getting into the questions you are asking for a short sale. Here is the bottom line. The bank did a BPO and they are valuing the property at 120k. Forget about what the property was worth in the past it is irrelevant. What is your current offer? Your goal is to list the property, get an offer, and then negotiate with each of the lenders (2 in this case) to get them to agree to the discounted payoffs.

Are you stuck on turnkey for some particular reason? I would think your market would have some good hands rental opportunities. I would not seek turnkey investments unless i was in a high cost east or west coast market. Even then i probably wouldn't do it.

If we see another crash then you can kiss wholesaling, rehabbing, and many of the other short term strategies detailed on this site goodbye. There are always exceptions, but that will be the case for the most part. I personally think things are very frothy now. I see many of the same things that were happening in 06 and 07. I think a downturn is inevitable but who knows when it is going to pop. I think the next downturn will involve a large number of distressed and or tired landlords. My area is cash flow central and there has been a lot of out of state money chasing yield around here. Over the last couple of years I have seen leverage come back in a big way. Most of it has been discussed on this site. BRRRRR???

There is no shame at all in being the type of landlord you are.  Many on here are more focused on the "white collar" side of the game as opposed to the "blue collar side."   

In the long run, it is the eye for the deal and your business sense that will make you the most money not being the repair man.  

I think the best part of doing it the way you are is your kids involvement.  What they are learning is better than anything that can be taught in school.  I worked with my family on a lot of rehabs when I was younger and I look back on those days fondly.  

Couple of things to consider: 1. Hired work can be written off on taxes but your time cannot. For example if you are in a 35% bracket then you are truly only paying 65% of what your are writing the check for. 2. Value of your time. Do you enjoy the work or is it a PIA? Do you have other more productive income producing things you could be doing? Is it taking away from family time? 3. Tenant exposure. The more you are at your properties the more tenants will suck away your time. If you go over to fix a sink many will spend an hour showing you other things that are wants and not needs since they know you are the owner. They generally won't bother a hired repair man. I am not saying one is better than the other but these are things to think about. Some enjoy the work and feeling of being close to their properties.

Congrats Ernie.  

I am in the wireless business as well albeit on the real estate development and tower ownership side.  

I think rentals would be a good place to start.  Knowing your line of work and the travel schedules involved, I would make sure that you develop a trusted network of reliable people that can handle repair calls while you are on the road.  

Looking for a little insight from some of the other markets out there in terms of financing. Has anyone been able to finance any of their properties without a personal guarantee? Before the bust it was game on for these types of loans, but now everyone wants a guarantee. Curious to see what others are seeing and if so what terms they are encountering. I don't have any financing in place but if I did, I would want everything separated and behind its own individual firewall.

What bank are you talking too? Whoever you are working with either (a) doesn't know what they are doing or (b) is looking for an excuse not to do business with you. Keep the property in an LLC. A bank will still loan against it but they will probably require you to personally guarantee it (based on property and LTV). The bank will have you sign over a deed of trust (or note depending on state law) on behalf of the LLC. This is the collateral for the loan. They will then have you sign a personal guarantee in your name to guarantee any shortfall Do not default.... They will come after you.

Short sales are not a mess. I have bought quite a few over the years and have brokered them on a seller side as well. Call the listing agent and see where it is in the process. An agent can list a short sale for any price they want. What the bank will agree to is another story. Don't let that turn you off though. It may take awhile to buy but you can often get a good deal on them if your are patient and the selling agent knows what they are doing.

Congrats on the call. If the seller is currently in bankruptcy then you will want to check with his/her attorney to discuss the type and status of the BK. You cannot do a short sale with a seller in BK unless the BK court approves and signs off on the sale.