All Forum Posts by: Patrick T.

If he is actually doing it at cost, great. GC fees can be a lot. But it has to be verifiable. Look at it from another angle. The partnership structure and knowing how to manage it throughout the project is a huge part of the deal. If your were a wealthy doctor whose money was making 1.5% and you could hook up with someone who could find the property, put the whole deal together and manage the partnership, get the rehab itself done at a big discount, and get it sold to where you make a very pretty profit...that's a pretty attractive offer.

But again, this person really has to know what they are doing. They have to show you previous projects and partners. And you have to have other Pro's eyeballing the deal until you understand all the intricacies.

I would look at a deal like that with great reservation. And if you don't feel comfortable at this point in your career or with this person, then absolutely walk away. But it is a way to do business that works, keep it in mind as you grow in this business.

And @Mike S. is absolutely right. You really want Pro's to review a deal like that.

How's the weather Mike S.? I grew up down there. Notre Dame HS.

Hi @Angelique F. Based on what little detail you give, it isn't necessarily a bad deal, if this person really knows what he is doing and really handles all of the organizing, project management, marketing and sale...there is a lot to a rehab partnership.

But if he does bring all of that, and you can be a "money partner" and he'll show you the ropes as you go. It could be OK. But, and this is a big one, you only want to get into that kind of arrangement with someonw who has a solid track record in the actual contracting work, in partnership management, in marketing. You will need good written agreements and to consult your attorney and accountant.

@Tom Meade has great experience in this type of project. Maybe he'll see this.

Good Luck!

@Paul Jamgotch I actually did receive some excellent input from @Tom Meade . I'll connect with you here on BP and give you more detail.

A BIG shout out to Tom!!

@Craig Vandenberg Actually putting together a successful partnership, finding and acquiring a property, working with your partner throughout the whole course of the project, marketing and sale of the property is a LOT of work.

Don't short youself. People make tons of money doing that. But as @Tyrus Shivers said, do your homework and get the right pro's on board.

Tremendous @Duncan Taylor , absolutely tremendous. You have created something from your heart that has no bounds.

And @Tom Meade that attitude will re-create our hearts and our country.

Thank you both.

@Nick R. as a recovering realtor I have to say that @Mark Updegraff is right to a point.

But @Martin Zawarski has a long term vision in mind that will pay off in multiples. It is so easy and typical to get caught up in the "emergency" of the moment. Kick back and take a breath, you are in control. How are you going to build your future in this business...certainly not on one transaction. Cultivate relationships. Create future partners and referrals. Be a Pro, and be good to the other Pros.

Thanks@Steve Babiak . You're right they can be a good solution.

I just want to encourage Jeremy to do the necessary research.

People tend to panic over inspections. Inspectors can be very good problem solvers, educators and networking facilitators for rehabbers. I usually have a good time with them on jobs, even when there is an issue, because they know I'm looking for the right solution.

All of the above is good advice @Ibrahim Hughes .

I would not try to hide anything from an inspector. They are usually smarter than the average rahabber and have seen dozens or hundreds of these problems. He may know there is a water problem in that area or even in that house. If he catches you hiding something or taking short cuts, you will be up a creek. It is not worth it.

While the other advice here is good, I woulnd't want to buy a house that had a pump running constantly through some months of the year. It is a significant cost in the electricity. And the pump will require regular replacement if it runs that much. Also, you must disclose things like that to buyers, especially if it is your work.

You should take a deep breath and look at the best long term solution. You own this problem. You can't just do a patch. The cost of a delay or an exterior drain is small compared to fines from the inspector, a lawsuit after the sale from a buyer, or having to go back in a do it right.

Hey@Jeremy Dyer it sounds like your original question was about an appraisal that existed before the rehab. And I agree with those here who said that:

1. Rehabbers don't have time to get appraisals done when purchasing a property, and;

2. More weight should be given to reliable post rehab valuations, whether through your own research, a realtor or an appraiser.

However (even as recently mentioned in a thread here on BP) you can have headaches if your buyer's lender sees discrepancies or very large differences between previous value (which they have access to) and current valuations. They can require two appraisals, for example, and expect you to pay for the second one.

They can also require copies of construction/contracting documents. Usually at the last minute, dragging out or stalling your closing. That can be costly to you.

A lot of rehabbers here on BP who are doing a consistently high volume of flips have good relationships with a realtor and a lender. Just like you can do here on BP, you can benefit from their experience and first hand knowledge.

Good luck!