All Forum Posts by: Yoni R.

Episode 247: How to buy your first (or next) property by the end of the year (the 90 day challenge) @Brandon Turner. 

Listened to your podcast got motivated and started moving. Just bought a house 5 days after listening to it. Started scouring the earth on MLS, talking with people in the neighborhoods I buy in, following the online auctions and putting in offers that make sense to me. And BOOM it just happened. I don't believe in luck too much but this is crazy.

I actually looked and analyzed over 10 houses and put in 3 offers last week. One was accepted.

Well now the real work starts and we have to rehab the place and stay within budget. Just wanted to say thank you for a great podcast that gave me a real push forward and also give other fellow BiggerPockets members some motivation. Just when you think its getting too hard to find a property something comes up. All you need to do is keep pushing forward and work in a methodical way with clear goals of daily action that needs to be done.

Thanks!!!

This is driving me crazy. I used the BRRR calculator and can't understand something.

Bought a house for 190,000 the ARV is 260,000. Rehabbed for 25,000 plus closing of 3,000. total all in for 218,000. refinanced after 8 months and received a 70% refinance 182,000 at 5% interest.

How is the "Cash on Cash ROI" in year 2 - 10.77%?

26,928/260,000 = 10.35%. And if my actual cash flow for the year after expenses is 3,875 and my cash now invested in the deal is only 78,000 now, then shouldn't my Cash on Cash ROI be 3,875/78,000= 4.9%?

What am I figuring wrong???

2%/year
Expense Increase

2%/year
Income Increase

2%/year
Property Value Increase

	Year 1	Year 2	Year 3	Year 5	Year 10	Year 20
Total Annual Income	$22,000.00	$26,928.00	$27,466.56	$28,576.21	$31,550.44	$38,459.81	$46,882.30
Total Annual Expenses Operating Expenses Mortgage Payment	$13,775.47 $5,140.00 $8,635.47	$23,052.29 $5,781.36 $17,270.93	$23,167.92 $5,896.99 $17,270.93	$23,406.16 $6,135.23 $17,270.93	$24,044.72 $6,773.78 $17,270.93	$8,257.21 $8,257.21 —	$10,065.49 $10,065.49 —
Total Annual Cashflow	$8,224.53	$3,875.71	$4,298.64	$5,170.05	$7,505.73	$30,202.61	$36,816.81
Cash on Cash ROI	22.85%	10.77%	11.94%	14.36%	20.85%	83.90%	102.27%
Property Value	$265,200.00	$270,504.00	$275,914.08	$287,061.01	$316,938.55	$386,346.32	$470,954.01
Equity	$87,328.26	$101,204.28	$115,624.94	$146,199.60	$234,040.22	$386,346.32	$470,954.01
Loan Balance	$177,871.74	$169,299.72	$160,289.14	$140,861.40	$82,898.33	—	—
Total Profit if Sold *	$35,684.79	$52,959.16	$71,191.55	$110,663.08	$228,579.50	$565,007.70	$979,325.04
Annualized Total Return	99.12%	57.20%	43.86%	32.44%	22.07%	15.11%	11.77%

@Wayne Brooks thanks for the info. If you have chance take a look at my last reply. Let me know what you think. 

Thanks. If the plaintiff is required to bid to their max bid then something doesn’t make sense to me. Maybe you can explain to me why a plaintiff would put their max bid at for example 200k when the house is only worth 125k. I understand that the default on the mortgage is for 200k that they owe the plaintiff (bank) but why would the bank want a house that is only worth 125k and not put a max bid at lets say 125k or a little less. If the bank keeps the house and sells it themselves they will only be able to sell it at 125k anyway. So I am not quite understanding why they would put their max bid at 200k for a 125k house. They are almost guaranteeing that they will have to take the house to themselves and that it will not sell at auction.

On the auctions where it says “plaintiffs max bid”. Does this mean that the plaintiff will for sure bid up to this amount or does it mean that the plaintiff may bid less than this but for sure will not bid higher?

I am setting up my strategy for buying foreclosure auctions and wanted to get some advice from the pros here. When bidding on an auction will you pay for a title search prior to the auction or do you do your own research and then just risk it? After winning an auction do you then pay for a title search and risk defaulting on your 5% deposit if something bad comes up in the title search?

What tools do you use for research and in what order do you do this? Is there a specific website that I should be using for research? Should I drive down to the city hall? Call the HOA? What title searches can a title company/lawyer do that I can't do? Do they have access to something I don't?

Thanks,

Yoni

@Scott England That is exactly my game plan. I want to concentrate on auctions and I don't mind if they are 30k or 300k properties. Why weren't they flip candidates? Are you just renting them out now?

@Jonathan Greene Thank you for the detailed answer. It's appreciated. I didn't mean to imply that everyone buys on the MLS. I meant to say that all the non investors just looking to buy a residential house or a one time investor just looking to buy one property usually will not go the length of educating themselves on how to buy at auction. Obviously the more swavy people are there at the auctions and definitely the serious investors.

I am very good at the research and usually am able to get all the info needed to make a decision on a property. I have been following the auctions for quite some time and understand very well how the process works. But there are still a few things that I could use your help on (or other members help on).

The main issue I am having trouble understanding is the title search and title insurance. All my properties until now have been taken care of by my lawyer so I didn't involve myself enough. What should I be looking out for? Is the insurance included in the title search so that if they mess up I will be insured for it? 

What about the first or second mortgage? When I look at the final judgement can I tell if it is a foreclosure on the first or second mortgage? The title search does it also give me that info? If the foreclosure is for the first mortgage does that mean that the second mortgage cannot foreclose anymore and I am free to go?

Any tips here will really be helpful and I will of course share my experience going forward. Thanks!

I am a flipper and have decided to start buying forclosuers at auction. I think this will give me an edge on local everyday investors that just purchase from the mls and are looking for a simple solid deal where everything is understood prior to their purchase.

I wanted to get members opinions of their experience from purchasing properties via auction and if there are any good tips to give me before I start firing away?

Also what is the best place to do a title search? There are two online sites that I was referred to:

http://www.fasttitlesearch.com/

http://easytitlesearch.com/

Thanks for all the help!

Just had a home inspection done on a house I have under contract. The inspector said that I need a foundation inspection done. It's a crawl space foundation and the floor is not completely straight in some places. Does anybody have a good foundation inspector to recommend in Fort Lauderdale, FL? Thanks!