All Forum Posts by: Chris Taylor

@Dave Van Horn

Just finished reading your book the other week. Only took me 3 days to read because I couldn’t put it down. A lot of valuable information so thank you very much. After reading your book I definitely can see why you answered this thread the way you did. Thanks for sharing your knowledge!

@Bill McCafferty

Congrats on your 310th note. I have been researching the note business and have become interested over the last month. I see that you buy performing and nonperforming. Would you agree that starting out it would be best to stick with performing notes? My understanding is that performing notes can provide steady cashflow versus a possible lump sum cash out (or cheap real estate) with NPNs. What do you consider the advantages of second mortgages versus first? Sorry for all the questions... I’m very intrigued by the possibilities in the note business. I’ve also have been trying to get an idea of how the market prices these notes but when I have checked some exchanges the supply seems limited making it difficult to judge.

@Teho Kim

It all depends on you're investing goals but this is a lot of work for $70 per month cash flow. I'm not familiar with the Indy market but I guess some people will concede some cash flow if they anticipate good appreciation. What I typically read on here is $200 minimum cash flow for SFH or $100 per door for Multifamily. This is assuming you financed 80% of the purchase price.

@Abi Wegman

Very informative for people new to real estate! Thanks.

@Kenneth Garrett

Awesome!  Glad to hear that.  Coincidentally my roof claim was also through State Farm.

Thanks everyone for commenting and sharing your experiences.  I'm glad I started this discussion because I certainly learned some things.  Hope it helped some of you out too.

@Kenneth Garrett

Wow.  That sucks.  I am sorry to hear that.  Thank you for sharing your experience.  $200K is the appraisal plus 25%.  Was this planned or just a number you felt comfortable with?  I guess that proves that if you are not insuring for replacement value then you should always go more than the appraisal or market value.  Like I said previously... I would never just insure for the amount of my loan and would always add a percentage to the market value.  

It sounds like you will be covered or at least close to.  If you get lucky you may be able to make the repairs for less than the insurance estimate.  I am not saying this happens all the time but I had a roof claim on my primary residence.  The insurance company came out and did their evaluation and got pricing.  They sent me a check for something like $7K.  I bought the materials and hired contractor to do the work (labor only since I purchased the material).  Labor and materials ended up being like $5K.  I know what you have going on is much more money and a much different scope of work so I don't know that this is something that would work for you.

Hope everything works out for the best and good luck!

@Matthew Maddaleni

Thank you.  Same to you.

Lesson learned is that you should always be sure of what coverage you need because it could have a major impact on your cash flow.

@Caleb Heimsoth

You are correct. It is going to vary by lender and also on your insured value compared to the replacement cost.