All Forum Posts by: Aroldo Villarreal

@Wayne Brooks Perfect! I just looked up the FHA DTI requirements and I think I should be good. Just hope that they include my rents as part of my income.

Hello BP!

I started investing a year ago and now have three rental properties and did my first wholesale assignment about two weeks ago. I'm getting married in June of this year and we are looking to buy a home. My question is, will I qualify for FHA loan of 3.5% down even though I technically am not buying my first house? The three rentals I bought have been used for investment purposes only and have never been my place of residence. I'm hoping that some of you out there have the answer. I don't want my fiancee to chew my head off because my RE investing prevented us from getting a home with a low down payment. Keeping my fingers crossed for good news! If you don't hear from me, you know what happened...... haha

@Brent Coombs I have already found potential buyers and buyers to which I've already assigned contracts to. My list is small, but am growing it every opportunity I get. Also, no, I would not list it with an agent. I've NEVER done it (in my three months of wholesaling :p) but I would definitely think it would get me in trouble with the seller. 

@Lucas P. Can you elaborate on the "minus fees" part of your talk with sellers? I'm trying to get as many tools in my belt so that I have a better way of dealing with sellers and objections. Great info!

@Gabriel Lopez & @Ruta Uleviciute I would like to stay posted on your conversations. I want to invest over there since my parents have ranches and homes over there but have trouble managing. It would be great to learn the similarities and differences in REI between Mexico and USA!

It's almost been a year since I started this post and over a year since I joined LU. Below are some of my experiences:

Yes, all of you who said I wasted my money, you were right. I'm working on building a time machine to go back and slap myself :p

I paid for a mentoring program in which mentors were never available and took forever to get back to me. 

They found me a "deal" that looked like this:

ARV: $117k

PP: $89k

Repairs: $8k

Out of Pocket: $15k

But that "deal" ended up like this:

ARV: $109k

PP: $81

Repairs: $13k

HML Fees: $7k

Refinance Fees: $4k

Out of Pocket: $26k

Plus $6.5k for joining the program = $32.5k out of pocket

I'm cashflowing on the property, but in hindsight, I could have used that cash to get WAAAAAY better deals. I'm getting close to having the property for a year and the tenant in interested in buying, so I might sell it to him hopefully for $115k, get my cash back, and some gains. 

What else did I get from them? Well, they kept telling me that in this market, you won't find anything below $20k out of pocket. 

"What about wholesalers?" I asked - "Wholesalers are evil. They take away homes from people who need the home and make profits being evil", they said. 

"What about flipping houses?" I asked - "That's a fantasy world. That never works and is only for shows on TV for people who have money and time to waste." They said

"So is HML the only way to go?" I asked - "Yes. Unless you want conventional lending, which is more out of pocket." They said

I also learned that cashflow= Rent-PITI (fantastic, so I'm cashflowing $550! - Suuuuuure)

Well, the list goes on. But I learned many great lessons of what not to do and how NOT to think. I wish I would have found BP two weeks earlier than I did and I would have not wasted my hard-earned cash. 

@Brent Coombs I just got it from other wholesaler websites and large company websites (homevestors, webuyhouses) and from what I see others writing on their direct mail pieces. By "every", I assumed (you know what they say about assumed) that every wholesaler did that. I like your statement about acting on behalf of investors, I am actually going to start using that right away!

I am, however, finding my own buyers to which I assign the contracts for the deals I find. Would that still be considered being dishonest with the seller?

@Jennifer Lee Good to see I'm not the only one making those mistakes. Where I am stuck is wanting to back-up my low offer with solid numbers so that they can see where that offer is coming from and that it is validated by numbers. Should I just show them, "Ok, I ran my numbers and here is my offer," without running them through the numbers I came up with (Market value, repairs, holding costs, selling costs)?

@Chaz Reid Hahaha, good thing I cleared that up! Hahahaha, I didn't want to leave that impression of "this guy is a horrible businessman" in your mind! LOL

Anyone have any samples of how you present your offers?

@Chaz Reid I don't include or disclose my re-sale price, but I include how much it will cost to sell with an agent. For example, if I'm planning on selling the house for $100k, I show that I will be paying 6% of that to agents. So they see $6k in the holding/selling costs of my cost break down. I 

I understand where they are coming from though, since the letter says "Avoid having to pay Realtor fees." Should I remove that from my ad campaign? If not, how should I explain it to them?

I keep hearing, "Oh I see, so you're just passing on those fees over to me?", or "Why should your holding and sales costs affect me?"

I'm still new to this, so I'm going up a steep learning curve. 

Good morning everyone! I have been meeting with sellers and making offers but haven't gotten one accepted yet. I got lucky on my first deal of this year. I called a FSBO, got it under contract, and assigned it to make $8k. That skewed my expectations a bit since it was rather easy! No marketing at all.

Anyway, now I've been making offers and haven't gotten one accepted. I know every wholesaler advertises "No Agent Commissions" or "Why pay those expensive agent commissions", but I can't wrap my brain about how to explain that to the seller because, as a buyer, you DO have to deduct the agent commissions since that is a fixed cost. 

In my efforts to be fully transparent with the sellers, I give them a breakdown of my renovation costs, holding costs, and selling costs. This is where they say, "Wait, so I am actually paying for the agent commissions?" I reply by saying that I have to take that into consideration because when I try to sell it, putting it on the MLS is the fastes and best way to sell a house.

Should I disclose that part or what would you advise?