All Forum Posts by: Casey Carroll

holy Moses. Did you see that last section there, on item c? Cash pick up? Run away as quickly as you possibly can from this fraud. Not a single hard money lender in the world, or ANY credible lender would ever in a million years offer something like that. Everything is always done through a real estate attorney or a title company. That's such a massive red flag that not even all the red color in Jupiter could color a red flag that would be big enough.

Be very careful about starting with rehabbing homes. I got my start here and had to learn some very expensive and costly lessons because of a myriad of mistakes I made (some of which, I picked up as advice from actual home study courses!)

You don't need the best credit to start flipping. You do need cash in reserves in the form of "just in case money" so keep that in mind. Don't try to get involved with a hairy deal... focus on cosmetic fixers to begin with and always, always, always hire licensed, bonded, and insured contractors, and call the local CCB to verify that the contractor you hire has a current bond and no pending complaints. Lastly before they ever start work on a project, you need to get a copy of their insurance rider with your specific address listed as a project on their own insurance policy, and call and verify the agency to ensure it wasn't forged. As long as you do all of these things, you won't have to worry about some of the nasty stuff I dealt with.

The cash up front is to have two independent evaluators (usually realtors) to go out and run a CMA based on an excepted ARV. This costs money to do. I've done deals with these guys before and they are conservative with their estimates because if you aren't, then you will surely lose money. I've done 4 rehabs, 2 with them, 2 with other lenders, and the two I did with them actually made money while the two I've done with other HML's lost money. If your deal passes their sniff test, you WILL be profitable... and they want to ensure that they're not putting you or them in a bad position.

This falls under the category of "opportunity costs." If you can deploy your capital in an investment which offers you a higher return than the interest rate you can pay down, then absolutely you should be investing it. Since mortgage interest rates compound on a daily computation, your actual basis for comparison is actually between 5.5-5.6%, which most real estate investments will outperform (you make money in 3 ways from real estate: appreciation, depreciation on a 30 year schedule, and cash flows). If your combined return on all three offer a better return than paying your mortgage, then it's a no brainer (and I can guarantee that you will earn more on that money by deploying it into real estate).

Have you looked into the "subject to financing" niche, or creative financing? I might suggest that you email or call every multi-fam on craigslist and ask them nicely "If you don't mind me asking, why are you selling? (after they answer) "oh wow, I really feel for you, and I don't blame you for wanting to sell! So if you don't mind me asking, how much do you owe on your current mortgage, and what is the interest rate?" If the triplex has 2-20% equity, try to meet with them, and after explaining to them that if they don't sell that multi-family in the next 6 months, ask them if they will consider selling with a realtor. If they say yes, explain the cost of selling with a realtor (6% commissions, 2-3% seller paid closing costs, excise taxes, 6-10 months of lost time, etc). Now the price with selling via a realtor is about 12-15% less than their current asking price. Ask them if they see how selling with a realtor 6-10 months from now will net them a 12-15% reduction, and if they say yes, then present your subject to offer as a means to save them time and energy.

Instead of buying rental properties on the MLS (which require mortgages and a high downpayment), perhaps I may suggest that you look into the "subject-to financing" niche, and acquire properties with built in financing. This offers a significantly higher cash on cash return (since you usually don't need much cash down on a sub-2 deal, if any).

If you want advice on bandit signs, PM me (this post will be deleted if I mention anything with bandit signs since they violate most local city laws). Flyers work really well, but require lots of boots on the ground. The marketing strategies you utilize should be specific to your niche. Are you wholesaling to landlords, or other rehabbers? Probate, NOD with equity, absentee work well. If you wholetail and plan on doing mortgage assignments, or sub-2, then text blasting and voiceblasting ads on CL, backpages, etc works really well (and this is legal to do because ads on CL are considered a business to business lead because they are soliciting for offers, and therefore don't fall under the same laws under the Do Not Call registry.)

The screening company I use is www.landlordstation.com, and they are owned by transunion. They give their transunion score, full credit report, employment verification, criminal background, and eviction record if you request it. They've been fantastic, and easy to use because everything is web based. Turn around is quick unless there are criminal records, then it takes slightly longer than a day turnaround.

Hah @Gary Parker

BTW, I have people threaten to sue me almost weekly (mainly because of my aggressive marketing tactics), or threaten to turn me in to the realtors board, but it's never happened.