Rafael Norat

Former Electrical Engineer looking to pursue investment opportunities. Lifetime student and always looking foward to goals to accomplish. I'm leaving this video to introduce myself and let everyone know what I'm about. Experience: Bigger Pockets Podcasts! Here to learn and learning everday. Currently buy and hold investing in PA. Looking to establish a wholesale camplaign in NJ very soon. Update 05/07/14: Have accumulated 4 units averaging 15% ROI and expected to have another 3-4 by the end of the year! Have teamed up with an experienced investor in rehab flip and hold projects. Currently have a wholesale campaign in NJ and looking for a NJ flip project this year. Update 12/06/14: Have another 13 under contract! Bought and cash closed on a 10 unit lot 2 months ago for $100k! 7 Units are already rehabbed with 5 units already leased for next month. Local bank just confirmed my refi (no seasoning) yesterday. Have another 3 units which I delayed the close till January which will allow me to clear up some funds from the refi to fund the purchase and rehab. Update 1/21/15: My 10 unit refi project is refiied!! Working on finishing the final 3 units. But, was able to get an after appraisal of 220k, which more than covered my initial investment and gave me rehab money. Just closed on the 3-unit I had waiting last week and will begin rehab on that one shortly. May be angling in that one as a rent to own. I'll post the 10 unit deal shortly..! Update: 7/19/15: Wrapping up work on my 3-unit project. Hope to have 2 units finished and rented by August, the 3rd unit finished and rented by September, and the entire project refinanced by October. May be able to cash out 100% on this one! Also started 2 fix and flip projects in New Jersey as well. I have 2 partners working with me on this part of the business. For both projects, we worked with realtors to find the properties and hard money lenders to acquire them. Hoping to turn these 2 around within the next 2 months. Keep you posted! Update: 10/14/16: So a lot of lessons learned since last update!! So, my 3 unit project,, JUST REFINACED! That one was a bit of a nightmare dealing with inadequate crews and trying to separate the electrical in an old house. Regardless, it is refinanced and cash flowing. So, even with mistakes, its hard to go wrong if you buy right! I also purchased 3 units during this time. A duplex which needed one side rehab while the other side was rented. Along with a half duplex which was rented. $55k purchase, ~ 30k rehab and refinanced that one actually before the 3 unit above for $105k. So, that one is cash flowing and successful! The 2 flips mentioned were nightmares from hell. Chalk it up as experience and don't repeat mistake. Its OK to be wrong, just don't stay wrong! Currently brought on a new funding partner and bought a duplex with previous fire damage. I always seem to grab the rejects! Found this one on Craig's List through and automated search and offer submission I had a virtual assistance carrying out for me. But, I bought this one for $5k, rehab is $50k, and should appraise for $75. I'm on my 3rd rehab team and seem to have found solid footing on my process and team structure. So, excited to see how this one comes along. Have another 9 units currently under contract (8 unit and single) which I'll update on as soon as I know its a go. Also got my NJ Real Estate License along the way! Looking to team up with wholesalers and be their comp guy to hopefully help them with their businesses and be a buyer along the way. Just too tied up in PA right now but focus on that at the moment. Regardless, you can stumble, you can fall, just get the f*** up and keep moving! You'll see the light at some point!! Update: 5/20/17: - Just read my last post.. I must have been on a roll there…" just get the f*** up"…. Classic.. - Since then I've finished up the single and 8 unit (actually 7 completed) and am in the process of refinancing the previous 2 unit (fire damage) as well as the single. Couple of notes: • I will most likely never do a fire damage property again!!!! At least not for now. A lot of unknowns and my project manager didn't have much experience in such projects as well. Either way, it finished and rented easily. Just got it appraised and awaiting the value. • Don't shuffle your feet on evicting a possibly problem tenant! I bought the 8 unit property. 6 were rented to units needed complete rehabs. One tenant was under assistance and was a bit of a hoarder. I hoped she could get her act together, but things got worse. Had to evict the tenant. Doing so late, now I have to wait to refi, as her units will most likely need repair. • Persistence and loyalty pays off! The credit union lender that I use steadily told me I reached the personal exposure limit his bank is allowed to lend up to. So, he referred me to a commercial lender which represents multiple credit unions which will allow me to continue refinancing by spreading the exposure over multiple banks. Sweet! Let me know if anyone in the area needs a commercial lender as such. • Watch your expenses come tax time! I always deduct as much as possible and report come tax time to get as much back as possible. Seems like a great strategy in the short term, but now that I'm in the 30+ unit realm, my tax returns are being closely scrutinized by underwriters. Why the increase in car and truck expenses? Why the discrepancy in rental loss? I look at it as a good thing to tighten up my numbers, but definitely a good lesson. • Loyalty pays: I have finally found a good project manager. He's not perfect but neither am I. But he's coachable and gets the big picture. He's making money and I am getting properties. Plain and simple. Pay cheap, you get cheap!! Build a good team that gets your long term vision!! • Use ALL your real estate where practical! ○ So the 8 unit project had 6 completed (rented) units, and 2 that needed rehab. One was a previous bar which we converted to a studio, the other a not-sure-what-it -was 1400 sq ft single floor area on the top floor. We did rehab the bar but not the single floor area. Why? Zoning may be a bit of a hassle to convert from commercial to residential and will most likely require 2 additional parking spots per unit. There's also limited parking in the area. Makes no sense, right? Wouldn't a commercial location drive more unwanted traffic? Well, government (and I do work within government as we speak) has limited logic. Also, the costs of construction on the 1400 sq ft space proved to be outside of budget as well as would create a unicorn of a unit. It would have to most likely be a nice loft, but it's too far out from downtown to actually pull the needed numbers. So that's off the table. ○ We considered on site laundry as an amenity. But after looking at the tight profit margin and lack of companies to support in the area (didn't want to worry about the maintenance ourselves), we decided against it. Also the units are renting out easily. So maybe we separate ourselves well enough. ○ We did come to an agreement to lease out the roof to a wireless com company for a monthly fee! They use low power antennas which are small and do not draw much power. Good profit margin, so at least the roof makes us some $ss! That's it for now… Just picked up another 2 units. Both singles. One is a row home which rents for $650, not much work needed. The other is a single family which needs $20k or so of work. Both for $37.5k. Should appraise together for $110k. I'll update that one once competed, hopefully in 6 weeks… Keep at it and don't let up. As Eric Thomas says.. "I can, I will, I must!!!" Real Estate Goals: In general, to establish a continuing stream of income. Looking to diversely invest, understand the market trends and adapt accordingly. Give myself the option of leaving my job in 7 years.. Currently Seeking: Partners and fellow investors! I currently have a great long-term buy&old operation in PA that I am building with an experienced investor I actually met on BP! Looking to expand my operations into NJ now, via rehab flips, holds, and wholesales. Update 11/20/2021 Hello BP!!! Been gone for a while but back and busy! Was able to leave my engineering employment about 3 years ago and haven't looked back. After opening some businesses and starting different projects, real estate pulled me back in and took off! Have done numerous flips since leaving. But since Covid, I pivoted towards short-term rentals and helped build a nationwide real estate meetup online that has been an absolute blessing! You can check us out at: https://www.rewealthinstitute.com Have also moved to Jacksonville Florida since to be closer to family and now investing in multiple states. Keep the grind and follow your dreams! Feel free to reach if you have any questions!