All Forum Posts by: Andrew Freed

Has anyone invested in farmland? I am curious about peoples experiences. Please tell. It seems like pretty solid returns. 

@Joe Gonzalez - Great advice. I would definitely start there.

@Deshawn Peterson In addition to Joe's advice, I would recommend driving for dollars around your area as well. At the very least, you will learn the neighborhoods, learn property values, and get a "feel" for the market. You can also use deal machine to identify deals and cold call those individuals later / add them to your lead channel. 

@Brad Tisdale 50% of a deal is better than 50% of no deal :)

@Brad Tisdale - In my opinion, it would be better to scale with other peoples money. Take a read of "Money, People, Deals" by Stefan Aarnio. He has a ton of really good strategies on how to split deals. But nonetheless, you could ask for 50% of the profits from the deal and split the other 50% with the private lender for being the active partner. A simple 50/50 split. In that case, you have no money in the deal and you can receive a cash flowing asset. You can then seek more equity partners and scale a lot quicker. You may be shooting yourself in the foot by not looking into JVing with equity. Way easier to scale with other peoples money. And once you show you are good at it, people will be running towards you in waves to JV on deals.

@Account Closed  - I would also consider using BP insights to gauge rental prices since you are a pro member. It is similar to rentometer and zillow, but offers you specific comps behind the prices. You can see units close to yours and what they are renting for. You can then choose a unit that closely resembles yours and base the price on that. 

@Joey C. I would open a HELOC on one of the properties and utilize that to fund your future real estate deals. They seem like solid properties so you don't want to get rid of them, but you want access to the equity. I prefer a HELOC over refinancing since it is a constant line of credit and you don't have to use it if you don't need the funds. Regarding DTI, when you have a HELOC, the loan officer will count the required payment towards your DTI ratio so choose an interest only HELOC. They do sometimes grab 1% of the loan as the minimum monthly payment as well on the line of credit so make sure you run the numbers or talk to a few loan officers.

@Kevin Polite My advise to you would be to run a net present value calculation of the scenarios and see which produces the most positive returns. You can run this calculation based on your current rents, your rehab house with higher rents, and selling / redeploying the capital into another real estate project with a different ROI. With these 3 scenarios, you can see what is your best option from a financial standpoint. Below is a link on how to run this sort of calculation:

Youtube Link - Net Present Value Tutorial

@Ryan Williamson happy to help. Citizen bank has some great HELOC offerings with really low interest rates and they even cover closing costs. It cost you nothing to open and you only pay interest on what you use.

@Ryan Williamson HELOCs are a super effective way at purchasing property without involving any other equity partners. The required payment per month is just added to your DTI when they determine what loan you qualify for. I currently have a HELOC at a 2.5% only interest payment with a line of credit up to $200K. You also have access to the cash in about 30 seconds from a click on an app. Obviously only buy "assets" and not "liabilities" with it that return more than the interest rate but it is an incredibly powerful tool in building wealth through smart leverage.

@Noah Dunlap - If there is a specific off market duplex that you are targeting and see true value in, I agree with everyone here and a phone call would be the best approach. But you need to call this person with a plan. First a foremost, you have to work to create a story of why you and your wife love this home so the owner can empathize and practice the delivery before prime time. You also have to be willing to make the deal appealing to both of you. You could always offer a seller financing option where you pay slightly higher than fair market value but put less money down. Find out what this persons needs, where you can bring value and make the deal as enticing as possible. 

At the end of the day, you want to ensure this property is able to cash flow positively once you and your wife do your next house hack. Having a property that cost you money every month puts a huge delay on your future growth potential.