All Forum Posts by: Chris Feltus

Timothy Rogers As far as finding a contractor to work with in the structure you spoke about, how did you go about acquiring one? I have been visiting real estate investment groups and checking out their sponsors, usually there are contractors listed that specialize with working with investors on distressed properties. Or meeting one at an event in person. Is your contractor well known and visits REI meetups etc, or more of the type you would find in the yellow pages? I am also in the DFW area as well, Fort Worth.

Thanks

Will Barnard thanks again for the in-depth reply, you provide a great service to the community!

Could there potentially be any legality issues involved, if you suggest a specific contractor that you work with to your end investor?

Will,

For those of us still learning to estimate repair costs and not actively rehabbing yet, would you recommend networking with a couple of contractors. Pay them a flat fee for their time and have them run through the numbers with you on houses you were thinking about putting under contract?

Repeat the above enough times throughout the years until you are experienced enough to accurately do it yourself . That's my approach anyways, in addition I have an excel database full of pictures of every single item you could possibly need for a rehab from home depot. I am also looking into visiting some lumber yards.

Thanks

Nice approach, out of curiosity how do you structure that sort of agreement. Does he look at properties you are thinking of putting under contract for a flat fee?

True. I have detailed excel spread sheets that automatically tabulate costs rent vs flip, probably wouldn't hurt to show them both when presenting the subject property so they can clearly see if one strategy is better suited over another.

When calculating an ERC (estimated repair costs) for a given subject property should the wholesaler provide an ERC for both Retail Flip AND rental? Or just one?

It seems to me giving them just retail flip ERC would be an option. That way if they are wanting to do a rent on the subject property, and you provided them with retail ERC, they should have plenty of additional wiggle room with their rent numbers, assuming you estimated retail ERC correctly.

Its the investors job to decide on the exit strategy for the subject property no the wholesalers. The wholesaler may offer their advice, but at the end of the day the investor decides.

Curious as to what others think, thanks everyone!

My mistake, yes you are correct. Going for the whatever the term is that represents what the discount was on the dollar you purchased the house for. Which appears to be MAO.

For a "good deal" on a property, what is the general consensus on the LTV ratio needed? It seems, at least here in TX, you need to get the property at $.70 cents on the dollar minus repairs including costs such as selling costs, holding costs etc. The deeper the discount the better obviously.

This is a hypothetical property. Assuming ARV, ERC and other numbers are correct, would a property such as this qualify as a "good deal"? It is priced $.70 on the dollar minus repairs.

I am a novice, but it seems the listing price for many HUD properties are too high to have a good spread for an investor by the time you factor in repair + holding costs etc. Here in TX at least, it seems HUD will usually accept 88% of what the listing price, which can make it difficult to find good properties.

Here is an example of a HUD numbers I commonly see in my area, with $0.75 on the dollar minus repairs (thats with getting the property at 88% listed price). To me, that seems like it is getting too high to be acceptable.

Here in TX at least, I have heard HUD will usually accept 88% of the listing price. I am curious what it tends to be in your area, especially other people in the Dallas-Fortworth Area.

Thanks for your time and feedback, I appreciate it.

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