All Forum Posts by: Dan DiFilippo

@Andrew Syrios this is really good, but I don't think anyone's discussed interest rates, which determine the concavity of our curve, and therefore our return.

@Tyana Blackledge as long as all of the numbers work, yes. But are you accounting for tail risk?

Every flip has at least a small chance to have a $20,000+ problem that's uncovered mid-reno. It's not that you need to hedge directly against that risk, but you do need to ask yourself what your ability is to withstand that possible outcome? Do you have the cash to absorb it, or will you end up at the mercy of two different creditors each with onerously high interest rates?

@Nicholas Jose well, what does he think, rules don't apply to him? What're you gonna do, write him a letter using a quill and then wax seal it and send it by courier?

"Kind gentlemen,

Though I find it of the utmost abhorrence that you may take offense at this notice, I indeed regret to inform you that I cannot agree to offer a leasehold estate of mine property as discussed in previous encounters."

Not to be rude, but......damn.

@John C. It's ambiguous - depends upon the individual.

One that thing I will fight anyone to death on is that the industry is a cost to society. 5% (maybe] of wholesalers are good. They don't justify the whole industry rife with grifters and scammers and liars. Let the good ones get their license and use their guerrilla marketing just like they otherwise would. They'll still get plenty of business. And deter the bad ones from entry.

Everyone participating will be better off.

Cool to see you want to come our way, @Stanley Kutsovsky.  Don-Carlos is the man to talk to for Fayetteville.  It all depends upon your preferences, but Fayetteville's lower price points and artificially high demand for rentals makes it a strong candidate for cash flow.

@Lynnette E. If you ended up buying a house that he showed you, but with another agent.....eesh.

Unacceptable. You could get sued for that.

@Christen G. I've dealt with a very similar situation, but without the later suit against me. I got my tenant's voucher stripped (very gratifying; I hope she's presently destitute) and was awarded a monetary judgment. Without knowing your local laws, I don't think she'd have any basis. There are procedures for action against landlords who fail to fulfill their contract obligations (providing and maintaining a suitable domicile). We can be almost certain she didn't use them before because she knew she didn't have a case.

Just get your evidence. Get a nice big folder, walk into court with confidence, and do us all the favor of keeping her off the taxpayer dole.

@Roger Devore Fayetteville-based broker here. I don't tend to recommend my clients offer 10% purchase price in deposits. Less than 5% will do in pretty much all cases. And we pick up rent-ready deals on the order of $100,000. I find that ARV's somewhat higher than that are easier to work with, but under will look better on paper.

Good insights from @Tucker Cummings as usual.

Great points regarding risk being made here. I think the reality is is that if you don't have enough money to buy a rental with *cash*, then your opinion in support of the BRRRR method can't really be fully valid.

That is to say that the real reason people get so fervorous over the BRRRR method is that they want to go from zero to fifteen units in five years and they have $70,000 in the bank.

@Craig Parsons a few thoughts on this. As an agent who specializes in investors.

Just right off the bat, I don't see anything you did explicitly wrong. So you may just have had some bad luck, or perhaps it's some sort of local custom you violated. Or maybe there was something unexpressed. Like something you may not have realized you said in that fifteen minutes of phone conversation that caused the agent to split. I don't know.

All that said, however, there are a few points that have been made that do carry some weight. The commission discussion certainly is one. If I'm not able to make a certain commission amount on a deal, I will charge an adjustment to my client. It can be substantial. That is to say, transactions under $100,000 almost always require an adjustment. Now, of course, an agent should discuss that with you and I presume you'd be understanding. But it's still part of an issue of the value of my time and effort.

For example, I have no shortage of clients who come with $20,000 and want me to make them a BRRRRillionaire. Essentially people who are just not serious (and they always think they are) or realistic about the market. I used to waste a lot of time on these buyers. Along a similar line, they're often asking for 90%+ LTV owner-financed deals, as if they're the only ones who'd want them. And it may be more common in your market, but a lot of owners where I am simply decline it. Other people say "well, I'd rather not go conventional, but I'm guessing you probably know of some private lenders who will do 30 year fixed for 0 down".

It's insulting to agents because they're basically asking us to "make" the deal for them. Usually because they can't do it otherwise. If it was within my power to "make" such a deal, I'd be giving it to one of my existing clients or keeping it myself. And to be clear, sometimes it is within my power to do that. But again, that's a privilege.

I don't have all the information, and I don't see what you did wrong here. But agents waste tons of time on tire-kickers who aren't serious. So we do have to be very selective about who we give our time to.