All Forum Posts by: Christopher Goldie

@Dmitriy Fomichenko, Thanks again. I connected with these private lenders through my local REIA. The one on Arcadia loaned on another project previously, and has become a mentor. I came across him by asking a wholesaler I met, again at the REIA, who he knew. It took about 6 months of working this lender and learning with him to have him loan to me, which that deal just went under contract by the way. He has experience in many aspects and helped me with a lease option deal, and putting offers together on a sub2 and owner finance deal. I couldn't get those closed, but I learned a lot and plan to keep working those types of deals. The other 2 lenders were just simply networking and getting to know people. Listening for the key word "lending" and bringing them a deal to look at. So far it looks like it paid off in spades.

No, I didn't use the BP calculators, my mentor/lender created his own lending spreadsheet that works great.

Kids, join your REIA and network! Magic happens, I promise!

@Dmitriy Fomichenko, I would be happy to share the details. The first one, 6630 Arcadia Woods Rd PP $75,000 estimated rehab $70,000, ARV $215,000. My lender is partnering with me on this one. He has a new investor that has been pushing for a place to put some money, but wanted it to be on one of the lenders on deals. So this works out just fine. No points, 12% interest due on back end. My lender is somewhat keeping his lending hat on by making me do draws, but pretty much whenever I need them and a small advance to get started. And it's only 2 minutes from my house so thats a bonus!

Second, 2729 Putnam St, PP $62,000, rehab $34,500, ARV $149,000. Lender is loaning $100,000 on this one at 2 points, 15% interest due on the backend. Advanced $23,500 for rehab at closing, and will receive remainder halfway through.

Third, 115 Rose Dr, Contract Price $38,500, $39,000 rehab, ARV $115,000. Have a verbal commitment but still working out loan details. Looks like probably 2 - 3 points 15%, but we'll see what I can negotiate.

I spent months tracking all 3 of these and my patience paid off. I first offered on Arcadia back in September last year, offered everytime it had a reduction. Funny thing is an agent/investor I know called me about it when it changed listing agents and asked if I wanted him to offer on it for me. I did, but somehow is other client ended up with the contract for 1k more. So I took it off the radar until he called me the day they were to close, their funding feel through at zero hour. Wanted me to put him in touch with my lender, which I politely declined. Immediately called the listing agent and said as soon as the contract is rescinded I'm in at 75k, money in hand. This isn't the first time this agent pulled that, but I'm willing to bet it's his last. 

Saw Putnam late January, overpriced from a wholesaler and waited for those reductions as well. Pulled the trigger when it hit my mark. Same with Rose, waited until the contract fell through due to lack of money, and grabbed it up. Hopefully the same won't happen to me, but we'll see. 

All 3 are no more than 10 minutes from my house in areas I know well. Couldn't be more pleased.

My take away, be persistent and unrelenting. It's not gone until someone closes on it.

Finally closed the second one yesterday after a 2 week delay. The lender made it clear there was one attorney in town they refused to deal with, but wouldn't tell me who. So of course late on a friday afternoon, supposed to close on the following Monday they let me know the attorney I chose was the one they won't work with. Had to start over with a new attorney. But it worked out and its done. Work starts first thing Monday morning.

@Michael Wentzel, define a pile of cash. I have enough to survive and I'm fortunate on this deal that the lender gave me most of the rehab money at closing, so no out of pocket and waiting to be reimbursed. These are flips, but I do have a refi source on standby if I can't move them before my note is due. 

Got a verbal commitment from another lender on the third property under contract and plan to close it by the end of the month. Should have enough to keep me busy for the summer.

While you are essentially house hacking, I would buy another property. Slowing keep working on paying down the debt. The market is hot right now so carefully evaluate your deals and don't over pay. But mortgage rates are low, and more than likely won't get any lower.

BRRRR - Buy Rehab Rent Refinance Repeat. Yes it's a great idea. Haven't done it myself yet, but it's on my list. I have a private lender on board who will fund these all day long if I can perform. Add in doing a cash out refinance and it can be very lucrative.

I would include a very brief list of the repairs needed to justify your offer. Maybe a picture of damage or 2. This shows that you aren't making blind offers wasting their time. Include your proof of funds letter and maybe even a photo of an earnest money check.

The cost to mail a letter is minimal, so I say yes. Mail to owner occupants. It could people don't think they can sell their house in poor condition, so you can offer that solution. However, in my experience, don't mention the poor condition to the owners. Some folks are overly sensitive. Ask what they like and dislike about the house, let them talk down about it. Good luck!

In my opinion, 1 $100k property should equate to a higher quality tenant over a $50k property. 2 properties equal double the potential expenses, double the potential risks and in the case you presented, no more reward. As you listed the benefits to 1 property are higher than 2.

I think it comes down to networking. The private lenders I use do some mail marketing, I don't know exactly what's involved, how they target people or what the messages are. A local rehabber advertises his business with signs at each property and has a link on his website for interested investors to check out. I found mine through the local REIA's and simply by asking other rehabbers. I've been told that word of mouth is a very powerful tool. Once you've created a name for yourself as a performer that folks with money will flock to you. Yet to be seen.

The first I look at for a flip is the days on market for comparable solds, and active listings. I try to look for under 60 days on market to get sold but usually no more than 90. No point spending time figuring cost estimates and viewing the property if I don't feel comfortable I can move it quick. The 20k profit seems a little low for such a large rehab.