All Forum Posts by: Jason Eyerly

The report link appears not to work. 

If the numbers are correct it could work as a rehab and flip but it is pretty tight.  Frankly I doubt the numbers are correct because I can spend $10K on a "rent ready" property. If it looks like it needs work it probably needs more than $10K 

You may not be able to buy with a conventional loan. If the property needs work you will need a construction loan. 

I am not following your rental analysis, need more info mainly monthly rent.

It sounds to me like you don't know your market well enough yet. What level of finishes are needed to be worth that $84K?  Will vinyl and carpet work or do you need ceramic tile and hardwood floors?  Will the dated kitchen be acceptable or do you need new cabinets and coutnertops?  Can those countertops be formica or does it need to be granite? 

This could be a deal but I think you still have a lot of work to do to be sure.

I usually do annual income at 40x annual rent and 700+ credit score.  They are about $12K short.  See if you can get 2-3 months in additional security.  Also, security deposit should equal 1 months rent.

Dear BP,

Seeking advice on the following situation, I am mostly a Wholesale Real Estate Investor & Fix-n-Flip Investor and don't hold any Rentals, so I have never been in this situation, but please read below, and see if anyone has ever been in situation before.

There was an investor that was doing a rent-to own with tenants, (Price $36K at 500 per month, 100% of Rent went towards Price)

The Investor Sold the Home to me and disclosed to Tenants that I was taking over Agreement (Rent to own) with them, And they had paid 6K so far, So, I wrote a new Agreement with the Tenants at new Price of $30K, Rent $400 Month 100% Goes towards Price, and Tenants Pays Taxes and Insurance (names me additional insured)

Tenant Paid rent about 5 Months, Paid Insurance about 2 Months, and Never paid the taxes...  So after 6 months, I had the property manager evict tenants, and they moved out...

When I went to see home, (The home was Trashed, The furnace was stolen, and the water pipes Busted because no heat)  I took pics of home, but not the Trash...as I threw all trash in garage.

I decided to cut my losses as this home was in South Bend, (Only one I had there), and I just sold the House As-Is for $6000 Cash... (I got a witness statement from Agent who described home as Trashed)

Later, I get a summons from Tenant. Stating they wanted their rent back they put in the property (Since rent to own), $6000 from Prior Owner and $1600 From me) and said they put in 1500 of their own money to fix up property...  They provided Receipts in a stack of anything from lowes receipts, to Grocery, to a large Papa John's Pizza...(I guess they wanted me to pay for their food too...)

Anyhow, I hired Attorney, and did Discovery, Which the tenants Admitted not paying rent, and provided Receipts of their fixing up... So I am seeking options from here..  (The Tenants are using a law Student so it's free legal for them) Here are my options below..

1. Can have Attorney Fight it, and Counter Sue  for all damages, even though I know they wouldn't pay if I won so it would just cost me attorney fees) My Attorney is $300 per hour

2. Try and settle with them (I think they just want something), for like 500-1000 Dollars?

3. Get Advise from Attorney but if I have to fight it, I can represent myself, (as I don't see how they have a Case... )

Again, I don't want to rack a bunch of Attorney Bills.. but want to stand on principle in this situation...

Anyone been in this situation before...  My Attorney says we could just wait to see if they pursue further...  because anything I have her do obviously costs $...  Any advise?

Thanks,

Brett

Everyone's advice is much appreciated!  @Derek Faller , I think a price renegotiation is a definite possibility!

An update:  The listing agent came back w/ a counteroffer from the bank: They suggested that I take care of testing, and if anything comes back contaminated, they'll handle remediation. (Not for nothing, I'm wondering in that case why they wouldn't just go ahead and also pay for the testing--which is the easy part!)

Although I'm considering it because it would be a good deal, I'm still a bit wary.  When I called some tank removal companies for rates, I was told that samples taken from alongside the tank would only result in about 75% accuracy.  If that's true, then I wouldn't want to leave anything to chance; I'd want to go the more "accurate" route they suggested & get soil from directly underneath the tank (they'd have to pull it up in this case--along w/ the deck that's positioned over it.)  Since the property would still be in the bank's possession, I'm currently waiting for verification that it would be okay w/ them to rip up the deck.  If they insist on just side soil samples, then I wouldn't feel comfortable w/ just that.

So, that's where we're at right now.  Part of me is like, "Scared money don't make none!" but the other part is like, "Is this really worth it?" LOL.  Does the bank's counteroffer seem a little strange, or is it normal? 

(Thanks for reading through the long-windedness... ;-)

I just sent out my first batch of yellow letters to the Kansas City metro market, and thought people might find the first impressions of a new wholesaler of some interest. My goal was to raise bit of capital to continue to fund my buy and hold investing. I sent approximately 1000 letters which went out 5 days before this post, have had about 30 call, and have learned a bunch and gained some better questions:

1) Not every call is a motivated seller. In the KC market, which is a pretty hot market, this list has already been mailed to several times, so many just want you to stop sending them letters. I have had 1 motivated seller so far, but she held a note that was 75% of the value of the property.

2) As a corollary to #1, think very carefully in choosing your marketing area. If you'd guess it's already been hit several times, it probably has.

3) Don't stay on the phone for 20 minutes with a dead lead. Ask quick screening questions up front such as "Do you have a house to sell?", level of motivation, and expected price. If they say no, or want above market value, I'm going to guess there is a 99% chance that you can buy at wholesale.

4) You are going to start speaking to people with real problems: deaths in the family, money problems, family issues, etc. Try to help them out without lecturing them even if you CAN'T buy their house. Many of the people who preceded me in these mailings seem to have been real jerks based on discussions with some of these homeowners. In short "HELP PEOPLE OUT WHERE YOU CAN"

5) Fielding calls takes a lot of time.

Questions:

1) Do people work these popular lists, or is it better to just say "Already been done too many times" and move on?

2) If there is not motivation, do you bother throwing offers, or do you simply move on rather than insult the homeowner? How do the experienced folks deal with this?

3) Do you find that letting folks screen themselves through voicemail is better than answering each call, or worse? I am starting to think that Michael Q. is on to something with his long winded screening phone call. Seems like a good idea to eliminate the tire kickers.

4) Any general advice would be very appreciated.

I hope that this is useful.