All Forum Posts by: Brit F.

@Brian H., it's just a structured To Do list...something that lists your different properties, agents, or other workstreams.  Then, then you write down the next thing you need to do, or what you're waiting on from them.  The purpose is to help consolidate your on-going property-related tasks in one view.  For example:

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123 Anywhere street: Waiting on Agent to pull comps

456 nowhere, unit 110: Property manager following up on late payment.  Call back on Apr 7

789 Somewhere: Sales contract pending.  Need to locate survey.

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I'm trying to think of an analogy to how you would manage a kitchen, but I've never done that :)  Do you have a method of managing kitchen operations that you can carry over to real-estate?

@Brian H.,

I tend to be fairly organized.  Here's what I do:

• I have a spreadsheet that lists financial summaries (revenue, expenses, taxes, ROI, etc) for each owned property and any we're evaluating. It takes 10-20 mins to enter the info for a new property, and we'll go back and refine the numbers as necessary, such as if the rehab budget/cost basis changes from our first estimate. If there's a number I'm not sure about, I highlight it yellow and come back to it later. Using this method, I can very easily see how the potential property stacks up against what we have.
• To manage email, I use different email aliases for each property, for example 123anywhereSt@<domain>.com, which then goes directly to my main email client.  It's easily searchable inside the email client.  Once I needed more aliases than my email provider allows on a single account, I created another account and configured it to forward all email to my main account, which gave me 10 more aliases to use.  Another tip is to always add the property address or some other identifier in the Subject so you can search/filter on it.
• To manage comms, if you find that your properties/tenants have a lot of 'stuff' going on at any one time, you just need a summary table or Action Tracker.  This could be a single spreadsheet/table that lists one property per row, then whatever columns you need: Owner Action, Tenant Action, Comms needed, or whatever else you need.  Update it daily, weekly, or as required.
• To track monthly income & expenses for tax purposes, I use one spreadsheet per property per year.
• If you're comfortable using cloud products, you could store these various docs there and have access from anywhere (e.g. OneDrive, Google Docs, or similar).  If you go with cloud storage, make sure you understand the security risks.

Paying $25k to earn $4.8k/annually sounds pretty good (19% Cash on Cash return before taxes), and you still have $15k in reserves.

Alternatively, presuming all $40k goes into the $150k house purchase, the cashflow may cover the student loan debt payment, but you have $0 in reserves.  This increases your risk unless you have other reserves.

I would be inclined to pay off the student loan debt.

Agree, @Ronald Rohde.  Thank you!

Thank you @Bryan Lyde & @Jay Hinrichs.  Appreciate your comments and ideas.

The Mom & I had a good talk today.  The primary purpose was to show her a couple of items that came up on my title search, so she can get a head start on clearing those, regardless of when she sells.  One of the items is a small loan from a lender that went out of business in 2017, and I couldn't find either a release or transfer.

I let her know more people would likely be calling, knocking, and mailing, and she should chase them off with her cane :)

While she understands the need to sell in the near future, we both agree that there isn't any reason to do it now. In contrast, she understands the outstanding balance must be cleared asap.

She's going to follow-up with some family leads on a loan to pay the foreclosing bank, and we'll stay in touch in case we need to step in.

I'll update the thread as things progress.

Thank you @Ronald Rohde and @Justin Kane.

The idea is that the charitable act leads to the investment.  The numbers would be fine for either flip or hold; I'm not worried about that.  But, since we're not interested in adding to our rental portfolio right now, we'd likely flip it.

I decided to not try to solve any divorce-related risk -> buying out the husband's equity is off the table for now.  If the divorce forces the sale of the house, so be it.

To refine my goal: I want to eliminate the immediate foreclosure risk and ensure that we can buy the house at a discount whenever they sell.  In a way, the 10% the bank wants could act like earnest money on a purchase agreement with a lengthy closing date.  Instead of paying the 'earnest money' to the Title Co, we'd pay the foreclosing bank.

I'm looking for creative ways to help a neighbor.  Here's the situation:

While perusing foreclosure notices yesterday, I found one posted for a long-time neighbor.  The outstanding loan balance is only ~10% of the value of the house.  The couple is about to file for divorce (wife living in the house - hubby moved out a couple of months ago), two kids out of high school, and college money is tied up in the house.  Wife has been unable to work for the past several months because of a nasty car accident.  The divorce will likely force the sale of the house.  Going through with the foreclosure would destroy so much for this family, and I'm determined to prevent that. 

The question is how to do this with compassion, create a win-win, and limit our risk.  Here's what I think I want to do since the house would likely make a good flip:

• Pay the 10% to clear the bank loan and ask for no repayment from the family in the short term.  In return, they would theoretically agree to sell us the house when they're ready.
• Mom & sons continue to live there until they decide to sell (likely soon to pay for college) or until the divorce forces the sale.
• Once they are ready to sell, we buy it at a discount & flip it.
• Alternatively, maybe we buy out the husband's equity in exchange for part ownership in the property, then buy out the wife's portion when they are ready to move.  This option provides the most relief, but ties up more of our $ and increases our risk.

What are some other ways to attack this?

@John Elias, another way to build networking confidence is to listen to a bunch of Bigger Pockets Podcasts.  You can mirror the conversations/questions at your events - as if you are the host interviewing the guest (or vice-versa).  The podcasts cover many aspects/professions in real-estate.  You'll develop a list of go-to q's for any type of person you meet in the business.

Outside of that, figure out in your own mind:

1) What value can you provide to the people you meet?

2) What do you want from other people and/or what do you need help with?

These will steer your interactions in mutually beneficial ways.

@Hen Ley, form an LLC when you have a business need for it. For example, if you want to lend using $ from a retirement account, you would create an LLC. If you want to lend by pooling multiple investors' capital, create an LLC. If you just want to loan money as an individual from your personal bank account, you don't need an LLC.  Sure, you can create one, but just be conscious of whether it's for a business need or risk mitigation.  If it's risk mitigation, insurance may serve the same purpose...just depends on you, your risk tolerance, and your long term needs.  The most conservative approach would be to create the LLC and have the right insurance coverage.

No matter which way you go, get a private mail box (similar to a PO box) so that you don't give borrowers your home address, especially if your loans are secured and filed for public record.

@Larry Spradling, it's probably time to jump on a plane and do a site visit.  It'll give you additional data that will help steer your future strategy with this property.  You might need to make multiple trips over time, depending on how things go.  Maybe you make one trip now to fully assess the situation, then one or more trips to meet a contractor if you choose to do any rehab, and/or a trip to meet the new PM and walk the property with him/her.  

A few plane tickets is a small price vs the potential loss you're looking at.