All Forum Posts by: Cody Sims

Hi Steve, 

The answers above are all good places to seek information.  Two callbacks out of 11 mailers is an insanely good return rate.  I am usually lucky to see a 3-4.5% call back rate, so 30-45 calls out of 1000.  There are many strategies and schools of thought so far as how to make an offer, every single one starts with establishing your "max bid" or what you need to make off of the deal.  Say you want to make 30k off of homes 150-200k and make 45k off of homes 200-300k.  From there you can work backwards.  

Whatever you do... ask the homeowner what the lowest they would take for the property is and MAKE THEM GO FIRST. Never know they may tell you half of what you were prepared to offer. It happens. Make sure they understand that you are a cash buyer and can close quickly. As a rough guideline, you can start off (or anchor) with around fifty cents on the dollar of what the home is worth ARV.

Hi Tatiana,

Ready for alternative advise.  I'm not a big Dave Ramsey fan (not over leveraging) and believe our time to make some money on real estate is here and may be relatively short-lived before the next downturn / correction.   Now would be the time to buy multifamily and flips. 

HELOC's generally carried nice low-interest rates as they are mortgage-backed, but I suppose it will depend on the % of the equity. Just don't dip below the 20%-%30 mark and you won't trigger your mortgage insurance again.

 Brandon came out with a great book that is still very relevant today, the no and low money down book.  I'm in the middle of an 8plex deal that requires $150k down payment and a 70k rehab, of which it only took asking one person to a partner and fund the deal.  You may find it very easy to find someone with the $125,000 you may need as a down payment if you're going to do finance the rest.  It may mean splitting the deal up but it dosen't require you to fork out cash like a refi would take and your still getting your hands dirty on a piece of property.

Just find the right deal and call around on the weekend asking agents and "buyers" for a partnership, it will be easier then you think. 

Thanks for all the responses!  I to am searching for a semi-local CPA in the Corvallis area.

Hi Patric thanks for answering. A very kind BP member Josh gave me a call about an hour after this post.  He held my hand through the finer details of getting this thing done and asked nothing in return!  The bigger pockets community never ceases to amaze me. Check out http://bridgetownhomebuyers.com/project/ for his upcoming deals.

I've recently met two other very helpful guys that live locally.   You hear it all the time but networking is really the best way to learn and grow.  Networking with BP members if the best

Hi BP,

I could really use some friendly advice from another wholesaler out there.  My situation is this...

I have a house under contract that nets me about 25k and leaves the investor plenty of room at around 46k net after a 30k rehab.  It's a solid deal but I don't have a buyers list, sort of stumbled on to this deal, then shopped it around to real estate agents as a pocket listing and offered a 3% BAC.  

I have an offer at full price the next day but am running into issues and questions from the real estate agent and buyer as neither of them are familiar with wholesaling.  It seems that not one agent in Oregon knows what a wholesale deal is as the wholesaler usually shops their deals to the investors directly and agents are never involved.  

The title companies also seem to have little idea of whats going on and told me they would have to disclose my profits even if I used the transactional funding to close then resold to the end buyer.  

I feel really close to getting this done, and like it should be easier.  I suppose my question revolves around shopping deals to agents and offering BAC.  Is this a bad strategy?  Does anyone know of a wholesaling friendly title company?  I'm using first American title in Corvallis and Albany, I got the referral from a 3yr old forum post here.

Is no one familiar with wholesaling in OREGON, south of Portland?

Hi Erin,

Sounds like you actually got a decent response from the 100 mailers.  One percent return sounds about right to me when dealing with Atlanta area.  It's possible you may have spooked the guy by saying you would close in one day.  I would never ever say anything less than "about two weeks" unless you have the cash waiting in your bank account.  Anything involving land deals can take a ton of time for the developer to sign off on.  They most often need to get there engineer out to the site, check city zoning, city restrictions, water and sewer access ( this varies wildly from site to site).  Suppose what I'm saying is I would give land deals wide berth at around 60 to 90 days to close.  

But if you had the developer all ready to buy it sounds like you just missed the deal, and that there will be more.  It takes me around 3,000 letters in my area to get a deal. Which sounds crazy, but that $1,5000 has made me $20k my first deal. Just keep plugging away.  If you have more time then money don't forget your craigslist ads, and that dialing for dollars is a quick way to get in touch with homeowners.

Best of luck finding your next deal!

I wish I would have had the foresight to start my real estate career of the way you are now.  House hacking would have speed things up a lot. Always remember..."if you aren't embarrassed by your offer it isn't low enough".

Hi Jonathon,

Congratulations on the new property!  I'm not experienced in the buy and hold side of thing and the math there on initial repairs always seem to be somewhat elusive to me as well. 

My advice for the repairs should be more then solid... find one super cheap guy for these repairs.  If you had the siding repaired for so cheaply the doors and drywall should cost less then your quotes.  It sounds like the doors don't need to be repaced and just adjusted correct?   This should take a handyman type and hour, and at most cost some touch up paint in materials.  The drywall can be a little more tricky and requires the contractor/handyman to visit your property 3X before it can be completed.  You may find your quotes get cheaper the closer the guy lives to you, so they're charging less in travel time.  

I suppose my advice is this, creat an ad on craigslist "$200 to fix door doors and some bathroom drywall repair".  Then go pick up two sheets of drywall for about $25 and some joint mud for $10.  It's always cheaper if you can get the supplies to the site, contractors will upcharge 20% and charge for the travel time.  

All said and done you pay about $235 to get your problems solved and be your new tenant's hero.  Sounds like a decent plan right?  Don't be afraid to spend some time hearing the right handyman type person.  Many of these guys stay around for years doing handyman type jobs cheaply for years.  Hire Pro's for the big jobs like your roof, extensive water damage and stuff that could be warranted like water heaters.

Hope that help.  Happy landlording!

Hi Eric,

Depends.  I've done quite a bit of both, calling and "I want to buy your home" mailers.  If you're like me it would take you forever to actually pick up the phone and have this semi accuward conversations with strangers. In that case, the sooner you get in touch the better so you mine as well upload your list to yellow letters and get them in the mail today.

Best Case scenario, I would pick up the phone and call every single time you see a property you would like to offer on.  Sometimes waiting will cause you to lose out on the deal, or lose the address to a stack of papers to forever be forgotten.

Any action you can take right now, no matter how imperfect it may be, will most likely be the right approach.

I have found quite a few small multifamilies that are off the market by sending yellow letters off of "non owner occupied list".   Sounds like your choosing your properties individually?  Not a bad way to go about it but you may want to send out letters to say, All fourplexes in your area and see what you get back.  You may have missed a hidden gem. 

Happy hunting.  I hope you find the right property

I went to a meetup yesterday here in town.  Geared towards talking to homeowner and wholesale type deal.  Only one person showed.  I agree that we need a meeting here in town, and that there seem to be enough members.   Can we get a few more people on board?