All Forum Posts by: Dave Savage

For any beginning wholesalers in the Rochester, NY area come check out the FFREIA meeting this Thursday night at 6:30 at the Brighton Town Hall.  The first two meetings are free and this month two of the area's best wholesalers will be presenting on how they run their businesses in our area.  

Check out ffreia.com for more info.

@Rick Dimicco definitely come check out FFREIA.  Our next meeting is Thursday night at 6:30pm at the Brighton Town Hall.  First two meetings are free so come out and network with other local investors and get a feel for the group.  

@David Stott what area of the city is it? I think 19% is reasonable in a number of B-/C+ areas that are popular with investors.

I think I would put the $40-60k into a second property and get another $800/mo in rent instead of only $400 additional on this property.

Do some basic landscaping - removing the overgrown shrubs and trees, paint the outside, list it for rent and see if you get a good response. If not, then increase your budget, but I suspect the minimalist approach will get you rented up and on to the next property.

You could start by calling every FSBO in craigslist to get experience talking to sellers. Then start driving for dollars and sending a handwritten letter to houses that you find that need work. Outside of gas and time you could get a lot of experience for $50-100.

If you can get a deal under your belt then you can start investing more money into direct mail marketing, pay per click, etc

You may get a lot of input on this topic. But one key thing I have learned - Find out how much they owe, and always make a ballpark range offer on the phone (I use 55-65% ARV assuming every house needs work). This way if they want signficantly more for the home, you don't spend the time driving out there, reviewing the property, working up a repair estimate, and then not getting a deal.

BTW, I add the leads that don't pan out on the phone to my follow-up list as they may become motivated over the next 6 months.

@Craig Shute I think what a lot of experienced investors are warning you is - Don't get over extended especially on your first deal. Using credit cards *can* work and experienced investors do it in a pinch but they have the experience to know the risks and minimize them. If you are going to be using credit cards to buy the deal, and then credit cards to do the major rehabs necessary - I think everyone here is seeing that you will be tapping yourself out and the next major issue (car accident, health issue, etc) could really put a strain on you financially.

In the end you have to be comfortable with the risks, but take the free advice you are getting from people with experience seriously. Good Luck!

@Billy Bob If you are getting title insurance, if the company is reputable I wouldn't see an issue using their title company. 3pts isn't that uncommon for a Hard Money loan, but for a PML it is up to negotiating...I bet if you do more deals with them you should be able to get this dropped over time.

@Craig Shute I may be missing something here but I see you listing the repairs as $1400. Seems light for the work you specified.

Bathroom Remodel - $2-3k (if you mention subfloor issues you probably need to do this right away)

Drains slow - Is there galvanized piping in the property that is rusting on the inside? Or is it simply a matter of drains that need to be snaked - $300-$xxxxk(for re-plumb)

Exterior Paint - $3-8k depending on the house and your local labor rates. if you put this off for too long you will be paying more in the long term by having to remove the existing and siding

Exterior Siding(if you decided to go this way) - $8k+ depending on the house and local labor

If you don't have the cash for the purchase, and you run into these expenses - and the repainting/flooring expenses that comes when people move out you are going to be barely scraping by. I would consider bringing in a partner to split the deal 50/50 and then you can still get a good education as @Paul J. did with his house.

@Billy Bob I think the biggest thing to minimize your concerns is to track each of the payments you made either with cancelled checks or copies of your checks from your online banking site. Then when you go to get the deed release if there are issues your attorney should be able to file suit if need be.

You should have an attorney draft up a mortgage agreement between the two parties to solidify this deal.