All Forum Posts by: Andrew Michael

Love it!

I have done a good number of deals down in your area.  I think without a solid track record your going to find it difficult to secure bank financing for the type of deals you want to do.  Furthermore, banks are terribly slow to close and release draws.  I have talked to several clients lately who told me their bank financed deals are taking 30 days just to get a construction draw.  At that rate you might as well finance the construction yourself.  

I think your realtor is correct.  You need to secure quick short term financing through hard money, private money or bring on an equity partner.  

The new build finance structures I have see are as follows.  50-65% of the land value at closing depending on location and specs.  Borrower must get through demo, foundation, and have something that resembles a structure in place.  Once the borrower is first in with say 20-30% of the LTC the lender comes in and back-fills the remaining construction for the duration of the project.  I am sure there are many programs out there but that is a typical structure up here.        

@Chance Waddle 

We also host a meetup on the 3rd Wednesday of every month in Falls Church VA. Feel free to come out as we have tons of wholesalers in the group and lots of NOVA activity.

If you are going to really do this full time then you will want to meet with a real estate attorney and have him draft up some contracts for you. I love that you took action and reached out to title companies but keep in mind that most title companies are used to traditional transactions and on top of that there are a ton of horrific title companies out there. Even the ones that I use on the investing/ lending side sometimes struggle with the wholesale transactions so you have to really work with them to get the HUD right.

I have a handful of title companies/ closing agents I could recommend to you for your future deals.

@Eric Turner I would not purchase this home unless completely vacant and clear of squatters (make sure this term is stated in your contract).  I would also verify its vacancy a week prior to closing and again the morning of.  I am not sure how the laws are in your state but in DC squatters can take over a year to get out. 

 In terms of financing your best bet is probably a private or hard money loan, season it and then refi out.  

For every flip we fund we require Hazard/Builders Risk Ins.  Unfortunately I have no idea what companies are providing in Hawaii.  

I really liked Never Split the Difference by Chris Voss.   Though not real estate specific it does cross over and is the best negotiation book I have read to date.  

@Chad Greenhill Why are you not raising private capital and securing bank lines?  With all that experience hard money lenders should be used for your one off projects not your main source of capital.  

There are only a few hard money lenders in DC that I know will do 100% financing.  Expect to pay dumb rates, 13-16% and 4 points plus.  Also prepare to have your money at risk.  100% financing is a frivolous practice that puts both the lender and borrower at risk.  

@Nathan Platter Your comment made me laugh. 

I went to the free Success Formula workshop as I go to just about every free (or paid) educational event I can fit in.  Its painfully clear that this is just another sales pitch and step 1 of them getting you locked into a coaching program but I suppose some newer investors still don't recognize whats happening.  That being said does that make them wrong?  No.  I go to these events with an open mind knowing I am walking into a sales pitch but its still worth my time and here is why. 

First, if I walk away with just one nugget of information that I can take home and continue to research then my time will have been worth it.  Secondly, these are great places to network with like minded individuals.  

One of my goals for 2018 was to create 2 new streams of revenue.  This (free) event gave tremendous information on FBA, branding, product sourcing, etc  Not enough to be comprehensive but certainly enough to spark my interest and warrant further research.  That's exactly what I did.   Since then I have set up various meetings with local retailers to buy excess inventory for pennies on the dollar.  I am not 100% set up yet but I have already learned a lot and the plan is in motion.  The point being this entire revenue stream that I never considered came from one free event. 

I know a lot of people take issue with the high costs of some of these programs but like anything else, you get what you put into it.  If paying a high sticker price for a coaching program does not motivate you to take action then its unlikely a really cheap one would.  The truth is they work great for some people but are not everybody is a fit.  If you do not believe you will get a return on your money then do not stroke the check.      

@Ricardo Fainsilber 

Depends how involved you want to be.  If you had the opportunity to invest in an asset based fund averaging 12%+ per quarter would you be interested?  120k a year in passive income is pretty nice.  I know there are funds right now offering these types of returns for accredited investors.

If you want to devote time and effort you can lend it out yourself or jump into a big multi as others have suggested.  

@Joshua Hill

I have actually had decent luck in Woodbrigde (not many deals there but the ones I've had have done well).  Just like on the Maryland side, people are being priced out of DC and the surrounding markets so naturally they are moving further out to more reasonable price points.  Woodbridge is on my radar as a potential up and coming market.  

I am not as familiar with VA so I can only speak on the few deals I have had there. In my opinion, Woodbridge would be a good place for you to start. You know the area so you have an advantage and you will have less competition than say PG (Bowie). If you are planning on doing some direct marketing I would throw a few Woodbridge zips in there and see what happens.

Once you start getting a lot of calls for potential deals, you do not want to be driving an hour for every property visit.