All Forum Posts by: Caleb Johnson

Hi Jennifer, my goal this year was to buy my first flip. I didn't have any capital so my strategy was to find someone who could fund the down payment for the hard money, closing costs and holding costs.

I searched BP for this person and after messaging 3 different people every day for 2 months I connected w/ someone who wanted to do a flip as well. I was able to add value and bring the connections (hard money, wholesaler and coach). All these people have had extensive knowledge in flipping so we had a good support team. 

From here we found a property in Scottsdale AZ.

Purchase 350k

Rehab 50k

Holding 9k

closing 7k

agent fees 23k

Comps 460k

Profit is looking like 21k+

Hoping the market pushes up this amount of course. If anyone in the PHX AZ market needs contacts I am your guy. Feel free to reach out. 

Happy holidays!

Hey Bri, if you don't have the money I would recommend getting your first deal done and then using the money from that to buy a course. Personally, what I did to start off, was finding people in my market that where doing what I wanted to do and then learned from them. So if I where you, I would find other wholesalers in your market and either take them to coffee and ask them questions. Then from that meeting take action, but now you have their number. So if you have any more questions, you can ask them what to do. 

You can even ask them if you can see them put a deal together from start to finish. You can also ask them if you could "work" for them for free. Now you aren't spending any money on a course but you are getting first hand knowledge and experience. From there you can take that knowledge and get your own deals.

Hope this helped. -Caleb

Hey Liam, I would recommend using the same brand, company and style of materials each time you buy a new property. That way you don't need to think about that every time. Make everything open and modern as possible and make sure it is functional. I would have a local investor with some more experience than you come out and see what their opinion is. Your contractor can too.

Hope this helped! -Caleb

Hey Cameron, I think that is a great way to make some money. I don't necessarily think it is unethical, as long as the amount isn't more the $25. This amount might just be because of the area that I am in. If you are in a more expensive market, like CA, then that is subject to change. Bottom line, I wouldn't have a high application fee just so I can make some money on peoples applications. Maybe you want to host an open house so people can see the place and know if they even like it before they pay an application fee. That way you weed some people out and you are still giving them the opportunity to see the place without paying you. 

In conclusion, I think it is a great way to make some extra money and don't think it is unethical. As long as you are making sure people know that just because you give them an application and they pay you money, doesn't mean they will get the place. I don't think there is any laws that prohibit from excessive app fees or the amount you can hand out. But I don't know your state, so look into that yourself. 

Hope this gave you another perspective. -Caleb

Hey Kelsey, congrats on taking the first step towards being a RE investor. There will be many bumps but you will get through them. First you need to look at the comps (comparables) in the neighborhood. You can practice this by going on Redfin and looking for houses that are similar to a house on the market. Practice this before you actually have a lead so you can get comfortable. The square footage needs to be withing 15% of the practice house, same beds and baths, same layout would be great too, lot size, it needs to be in the same neighborhood(not across major streets). This is how you can see what the ARV will be. This will take some time to get used to but keep at it. Then you need to find out what the repairs will be. I found out what they where in my neighborhood by getting bids from contractors, coaches and other flippers. So you can go on BP network tab and see what other people are paying for repairs and maybe they will even share their contacts with you so you can ask the contractors themselves.

Once you find both of these numbers out you can work backwards. So you have what you want to make, what the repairs will be, what the property will sell for afterwards, factor in holding costs and closing costs too. I have heard people add in 30% for the investor buying the place so that will be their profit. 

Another recommendation would be to ask some other wholesalers if they would walk you through how they do it. Be sure to add value to them by buying their lunch or some other way. 

Hope this helped. -Caleb

Thanks for the post Jorge. You make a lot of good points and I think you are right. If it is going to risk someones future in RE then they do need to realize that before that happens and take actions to get a PM. 

The only exception is if someone knows that they will get to the point of hiring a PM and they have planned for it. I am self managing but I know that I am in it for the long haul. I will do what ever it takes because I know there is nothing else but RE for me. I have planned that once I get another 4-plex next year that I will be getting some systems in place to help with it all. Of course if it gets to be too much with my job, I already have 2 companies lined up to pull the trigger. 

Good luck everyone with your investing careers. -Caleb

Hey Randy, thanks for posting this. 

For me, life as a landlord has not changed because of the pandemic. It has actually gotten easier because some of my tenants have decided to pay me electronically and I have had to see them less. But this might vary on a state by state level. Go to your local meetups or just go to the network tab on BP and message some landlords that are in your area. See if they have any problems and ask them questions. I'm sure they would like to help a newbie out.

Hope this helps. -Caleb

Hey Mark, thanks for posting this forum. I think it will help a lot of people and may save you a lot of heart ache. 

Run for the hills! I was just speaking to my mentor a couple days ago and he had someone do the same thing. Paying a lump sum of the rent up front is usually a huge red flag. People will put on a good face so that you don't feel there is anything wrong with them or their past. If you dive a little deeper they usually have a record/felony. Once they have the property they will start using the property as their personal drug house. If you look up the video by Graham Stephen on youtube called "Worst Tenant I Ever Had", it will explain. Save yourself the heartache and pass onto the next guy. 

I do think that if someone has a credit score that is just under your requirements, then you can give some leeway. As long as there are reasons for it. Like a student that hasn't had a credit card and is just getting out of college. But someone who has lots of fancy things or debt on credit cards is usually a red flag too. But if someone offers you to pay rent like this guy did, move on immediately. 

Hope this helped! -Caleb

Hey Ruby, thanks for posting this. Wholesalers can be a great tool. 

Pros: 

They can find good deals. Right now the way the market is everything is expensive. Houses are getting tons of over asking offers. Now wholesalers can come in and get something under contract that is on the MLS because they are experienced in getting people to sign contracts and can spot a good deal.

They can find off market deals for you. They can find good deals that nobody else can get and they get them at a good price.

Cons:

There are always bad salesman. There are good ones too. You need to be careful with anyone in any industry and make a good relationship with them first before giving them any money. You might get into a situation where that person is just professional. They are unresponsive, rude and in experienced. 

In conclusion, wholesalers are a good place to start. Test the waters and get on their list. See the deals they bring to the table and if they work with your numbers. It's not a bad thing to work with them. We all need to start somewhere. If you can afford to do your own marketing campaign then do it. But if you can't right now then just use wholesalers or the MLS.

Hope this helps, happy hunting. -Caleb

Hey Whit, that is a crazy idea and I haven't heard of anyone doing anything like that. But I like it! 

I would consult the bank who is giving you the loan to see how they feel about it. That is the only problem I would see. Is that the underwriter is going to see that you are selling to yourself. I'd be curious to see what happens when you speak to them. If you remember please let me know. Good luck! Hopefully it works out for you.