Sabrina Mendoza
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Thank you again ,Jackie, always the voice of reason. I guess I’m just not looking hard enough but fixer-uppers seem to be really scarce where I am (without driving out an hour+ and still being in marketable areas anyhow). Even the houses in lower-priced areas are mostly updated within the last couple years and “pretty” outside— or at least not in bad enough condition to be substantially discounted.
Maybe I need to pursue something other than wholesaling . . . I haven’t finished the lessons on master leasing and seller financing yet but maybe that’s something more doable for my situation. I would like to do a Lonnie deal too but am not clear enough on how I would pull that off with my current meager resources. Apparently there is a mobile home park somewhere around here that is pretty nasty by the sounds of the customer complaints I’ve come across (poorly managed, little to no amenities, over-priced for the lack of quality, drug dealers setting up shop, etc. A couple even went so far as to say it should be bulldozed completely). Don’t know about the location but I wouldn’t even want to go near it if it is half as bad as all that.
Back to the drawing board—
— S.
Thanks for all the input, everyone! I think I am going to do some watchful waiting on this particular property since the current numbers don’t seem like that great a deal for my targeted buyers.
Now I have identified a house nearby that seems to have more potential: 3 bed/ 2 bath only partially-updated, has some foundation issues (estimate on file), definitely needs some fixing up inside including unfinished paint, carpet, some cosmetic modernizing, etc. Looks like a good project for my rehabber buyers with a listed price of $125k in a neighborhood with estimated values of $115k-147k. Only hitch is that it is an REO property and what I’ve seen on the forums here seems to point away from REO’s as wholesaling opportunities. But might it be worth a shot to put in a low offer on one that obviously needs work like this? Isn’t the worst that can happen that the bank rejects the offer? I’m prepared to learn the extra nuances of a deal like this if it would make sense to do so— what say the seasoned pros?
All great info, thanks for the response. I know there are still some missing pieces in this puzzle, so thanks for raising those points. I guess there are a couple “oddballs” about this property:
1) Based on the seller’s listing (I haven’t seen the property or even contacted the buyer yet), it sounds like all the major work has already been done to it. Granted, it would probably be off-putting to the average buyer due to its age and small size, but it is certainly comfortably habitable, and even seems a bit more “luxurious” than one might expect for a house in the older, less expensive side of town. The only red flag I can think of is the lead paint and other “old house” issues, but I would hope the recent “fresh paint” has addressed that . . .
2) I looked up the county tax records but can’t seem to find a deed history, so can’t tell how many owners or if there is a mortgage. The current owner appears to be an elderly gentleman whose recorded address is in a small town about 2 hours away; however I can’t determine how long he has been the owner or who (if anyone) currently occupies it.
3) Nearby houses seem to rent in the $1k/month range, but I haven’t yet confirmed those numbers. With such a small mortgage (and fairly low property taxes), maybe I should consider keeping it myself at that rate
Sorry to hijack this thread, but I am trying to understand what is going on in this deal. Am I correct that the inspections report is because the OP is going to do an HBS to sell it— and isn’t something that would normally have to be done if he was just going to turn it over to another investor/ rehabber to purchase?
In other words, how much due diligence is required of the person writing the option, vs. the buyer that they have lined up to assign the option to? I’m reading the “Steroids” book but can’t seem to wrap my head around the idea of me NOT having to pay for home inspections, title searches, environmental reports and surveys, etc before putting it under contract???
— S.
Just had another thought: Is it possible to make options deals on properties being listed or brokered by an agent? I have found a few properties in lower-priced neighborhoods, but they are not FSBO. If it’s possible, how does the process differ from dealing directly with the seller? What about REO’s— I wouldn’t think a bank would be open to an options agreement, but then again they are eager to unload the properties, right?
Hi Jackie, thanks for the welcome! One of your students, Gerry Cox, is actually the one who recommended this program to me. I am in the Plano/ Frisco area outside of Dallas.
I will be sure to check out the items you mentioned ASAP. Very excited to see so much helpful information gathered all in one place.
Thanks again!
Hi everyone, I just joined Cashflow Depot yesterday and this is my first time posting. Investing is a completely new world to me so I am really eager to learn as much as I can and meet some seasoned pros willing to help me learn the ropes of this business!
I’m in my mid-20’s, part-time employed but realize that I hate being someone else’s wage slave and want out of the rat race. The entrepreneurial life has long been calling me and it’s about time I answered, so here I am with a dream of creating enough cash flow from property investing to live off each month without having to work a job I hate. I don’t have a lot of “startup capital” to lay out right now, but am willing to “bird dog” for mentorship in the ways of master/ sandwich leasing to get my foot in the door. Eventually I would like to own a number of properties for equity building. I will be leaving my current job in six months for health reasons, so even a partial leg up on my first goal (monthly cash flow) would be a great help.
Obviously I will be doing a lot of studying through the wealth of information available here, but if anyone can point me in specific directions I should be focusing on, that would be great! What should I be reading, listening to, who are the people I should be talking to and adding to my team (particularly interested in real estate attorneys and CPA/ tax advisors who can help), etc?
Thanks so much! I’m looking forward to increasing my financial IQ and becoming involved in this exciting community.
— S.
