All Forum Posts by: Joey Smajd

Thanks Wayne for that quick response, I'm obviously still learning a lot! Thanks everyone for your help thus far, I know what seems like a serious question to me now will probably seem quite silly to me a year from now!

So I believe my agent made yet another MISTAKE!!! The offer was submitted last Thursday 6/20/13:

How much time is a bank/individual typically given to respond to an offer?

Is it supposed to be written on the Purchase & Sale Agreement?

On line N. It clearly says Time Limit of Offer: with time and date but it was left BLANK!!! I asked my agent about it yesterday but he has not replied.

What should I do, resubmit the offer with this corrected? Help please!?!

Christina I 100% agree with you! That is why I am keeping my agent for this deal it's only fair, however my concerns were only confirmed after he botched the paper work for our offer not once but TWICE!!! Everyone makes mistakes but this is my first deal and I at least want to have my offer submitted CORRECTLY!!!

Any advice on how to find a good buyers agent for Investors?

Also he said that we should go ahead and get our home inspection done but what if our offer isn't accepted won't we be out $400!?!? Shouldn't I wait until the offer has been accepted to get it inspected?

@David Beard yes I am using the FHA 203k rehab loan.

I have a PRE approval letter but have to get it modified because it stated I was buying as an investor with 20% down, which was for another property.

So you think $100k is too much based on my numbers? I figured it was on point based on J Scott's formula. Or if other investor rehabbers will want it below that number do you think a $100k offer is aggressive enough?

Also what if I've already seen the property with my agent although I'm considering finding a new one (since he doesn't seem to have a lot of experience working with investors) Can I still cut him out of the loop and deal directly with the listing agent? Or is this unethical?

Thanks Stephanie! I'll definitely have to remember not to get too emotionally attached to any one deal!

As a rental the numbers don't look as great after repairs unless I could get close to $1500/mo then it might work as an exit strategy.

As far as offering 20% less than what I'm willing to pay for it seems like sound advice, but as you said it all depends on many factors that depend on each individual deal and market.

Seems to me from what I've read in J Scott's "The Book on Flipping Houses", there really is no ideal rule of thumb when offering this % or that on any REO. It comes down to the numbers and if they work for your particular deal then go for it, but if you have to pay more than the formula of

MPP= Sales Price- Fixed Cost - Profit - Rehab Cost

then just forget it and move on to the next one...

So guess I've answered my own question in this example:

$110 = $225 -$25 -$25 -$65

Think I'm going to offer $100k to start
with $5k in Earnest money...

Here's my first REO Deal:

I live in West Central Georgia on the border of Alabama attempting to make my first offer on a 2 story in a decent neighborhood that has only been on the market for 2 weeks:

Built 1967
4 bed/2.5 bath
3370 sqft
list price is $110k
Needs $50k-$70k in repairs
Fixed cost projected $20k
Projected Profits $20k-$40K

Plan is to close on the property for hopefully under $110k

Renovate the property within 4 months

Move in by December 2013 and live in it for 1 year

List it for sale in Fall 2014 for around $230k

Comps have it coming in around $225k but think will be hard to sell in our current market and would be better to wait.

I have a home that is free and clear and plan to rent it out to offset the mortgage/ins/tax while living in new home.

Other info: REO's in our area seem to be selling quickly within 1-3 weeks of first appearance on MLS

I will be financing the deal ideally 96.5% of sale price

So should I offer full listing Price Initially based on these numbers?

Or should I gamble and go 10-15% below and risk losing it?

How much earnest $ should I put down is $1k enough I've heard $5k is better?

Submitting my offer in the morning please any guidance or tips would be greatly appreciated!!!