All Forum Posts by: Berny Petersen

Welcome! I love the idea of renting by the room. Maximum bang for buck. Dig in, you'll find enough info here to keep you busy for a loooong time...

I can't find this anywhere in the thread: why are the windows boarded up in the first place? Broken glass? If that's the case, just replace the panes, with permission. Super cheap. If the wood dividers are damaged too, just replace the sashes. Sash kits for double hung windows are $90 - 140 each, complete. Why replace the whole window, frame and all? Are they even damaged anyway? Of course, if the owner doesn't grant you permission in writing to make repairs to his property, all of this is moot anyway.

I don't really agree with the numbers that agent was throwing at you either. Brought down the whole neighborhood by 20%, slashed the value of your house by 50%, etc etc, seems a little drastic.  Is the house in Norcross? There are plenty of areas close by with rehabs surrounded by distressed properties that are selling like crazy; Chamblee, Doraville, etc. Of course I don't know where your house is so I can't say for sure. Have you seen any comps lately? I would love to see this for myself.

Hi @Eliot M.    I'm certainly not a tax expert, but I'll chime in with some info I've gleaned from my own experiences. 40% seems a little high unless you flip a lot of houses each year and that is your ordinary tax rate. I've had 3 different scenarios at 3 different rates come in to play:

1. Short term capital gain = ordinary income tax rate

2. Long term capital gain = 0-20%. (for me around 18%)

3. Ordinary income tax rate - when I did several in one year they were considered inventory and taxed at regular income tax rate instead of capital gains.

If you are coming up on owning the house for a year, you might be eligible for long term capital gain, which might be the lowest rate of them all. Definitely check with your tax pro. Now I'm going back to read the story about your neighbor - that sounds interesting...

Funny how that works, isn't it? The stuff that used to seem scary is just another day in the life. 

Great story!

I think the biggest reason that loan isn't discussed more is because it's not available - usually. Lenders are not going to loan money using collateral that does not exist. Future value is a number based on an asset that does not exist today. That's why terms like 65% of ARV are so common, and hard money and private money lenders exist. The lender loans on a current value he feels confident he can recoup in the event of default.

What was the appraised value as/is? Was your relationship with the lender a strong component of that loan? I've had a lender in the past include some rehab money in the primary mortgage, but only because I bought it under what it would appraise for as/is, and because we had a very strong working relationship. It was not just a loan product that they offered.

I would use a loan like that every time if I could find one. If anyone knows of one that exists in GA please let me know! 

@Ryan Bennett I've been to a few of the AtlantaREIA meetings, but did not join. It is possible to get some good information there, and meet some people to learn from, but you will need to know going in that these organizations exist to sell a product. Each monthly speaker will have their own "system" to sell, and the people that run the group sell stuff too. I've yet to see anything sold anywhere that wasn't available right here on BP. (there are no secrets!). That being said, if you go with an open mind and pay attention to who is there it's possible to make connections: attorneys, vendors, etc. You can get good ideas from some of the speakers without buying anything.  They will hold a "haves and wants" session where members can present deals they have and deals they want. Whether they are any good or not can only be determined after analyzing, but the more exposure you have to what's going on the better off you'll be. Go check out a meeting without joining anything - keep your blinders on and avoid the hype, and see what you think.

I should clarify that post: 

You do have to be a licensed real estate agent to have access to the MLS in GA.

You do not have to be a member of the board (Realtor). That part is optional.

BernyP

Hi @Tom Parris

In GA you do not have to be a Realtor to gain access to the MLS. It's optional.

BernyP

Hi Ashish - The short answer to your question regarding cost of MLS access is: it depends.

I'll try to explain what I mean. After you get your license you will need to choose a broker to hold your license. All licensees in GA must work under a broker. That being said, there are lots of different fee structures available, mostly regarding commission splits and monthly costs. Generally the less you pay per month the lower the split, or there will be a "per transaction" fee that you pay the broker for each deal you close. Keep in mind that a lot brokerages will charge you for your personal deals, too, so even if you aren't doing retail business but are buying and selling for yourself you will still have to pay the split or transaction fee.

As far as cost of MLS access goes, that is dependent on the brokerage. Some include it in the monthly office fees, some offer it separately at a discount, and some don't pay for it at all. I'd suggest calling or visiting several and the get the breakdown of their fee structure. Remember there is much more to it than just MLS access when you are doing lots of transactions. The broker with the lowest fees might charge the most per transaction, even on personal deals.

Hope this helps some, let me know if you have any more questions!

BernyP

Happy to help - if you want to send me a colleague request we can go over the details.

(Licensed agent for 20 years)

Thanks!