All Forum Posts by: David Lecko

@Will Long thanks for mentioning DealMachine!

@Mike G. Yes and it works in Hawaii too!  :)

Thanks @Kathryn Dunnivant Windsor park is so charming, I love it! Will you be doing any work to the house?

@Alexander Ritchie thanks a lot! My score was in the 700-800 range. I realize not everyone may be able to qualify for the same 4 cards I did, but I liked the flexibility credits cards gave me. Since my project ran long I didn't have any extra holding costs other than lost time I could have been renting it out.

@Kevin Medina it is $.99 for each card. They are full color photos of the house on both sides and they send from your smartphone! There's an entire list of benefits you can see if you download the app and look at the home screen of the app.

@Dennis M. are you saying that a 3 year lease is a rookie mistake?

@Ray Johnson this is in the middle of the city in the Broad Ripple Village. What rent range would you be looking for?

Investment Info:

Single-family residence buy & hold investment in Indianapolis.

Purchase price: $4,782
Cash invested: $67,000

My 3rd deal! This was the 1st deal I bought from driving with the DealMachine app (I made this app btw). I found the house with a tarp over the entire roof driving one day and added it to the app. From that point, a postcard was sent to the owner monthly with a pic of the house on it. Four months later the seller called me and I bought this house for $4782. I financed the renovations with no-interest credit cards. It is now my first full-time Airbnb. The first 30 days on Airbnb brought in $1826.

What made you interested in investing in this type of deal?

I couldn't find any deals on the MLS at the time, so I looked off-market for a property that I could buy with instant equity.

How did you find this deal and how did you negotiate it?

I found this one driving specific neighborhoods where I wanted to buy a property. I added all of the properties that looked like they needed maintenance to the DealMachine app, which automatically sent postcards to the owner every 21 days with a pic of the house on it. This owner called me after the 4th postcard. I used list source to pull recent sales for the area and presented the lowest ones as comps (this house was in bad condition).

How did you finance this deal?

I bought the house $4782 cash. I financed the rehab with 4 no-interest credit cards. I found the best cards on nerdwallet.com with the "no-interest" filter. I applied for the cards back to back on the same day. I kept applying for more cards until I had the amount of credit I needed.

How did you add value to the deal?

This was a total transformation! We changed the roofline to add a vaulted ceiling and reframed the interior to add a lot of functionality including a 2nd bathroom, a laundry nook, an HVAC closet, and a hallway. (Previously the house had no hallway, you had to go from room to room).

What was the outcome?

I'm all-in under $70,000. The first 30 days on Airbnb brought in $1826 (I paid $200 in cleaning fees). That's my second property that meets the 1% rule (almost 2% on this one!).

Lessons learned? Challenges?

My mistake was forgetting to build in a late fee to the contract. Halfway through, months passed with no progress. The renovation should have taken 3 months and instead it took 9 months. My contractor kept saying he'd start up again soon. I ended up finally firing the first contractor. When I found a 2nd contractor we got the rest done in 6 weeks. This taught me to put the scope of work in writing, let the contractor pick the due date, and attach a fee to that contract for every day it is late.

Investment Info:

Single-family residence buy & hold investment in Indianapolis.

Purchase price: $104,750
Cash invested: $26,187

This was my second deal! People often say the first deal takes you from the land of "dreaming" to the land of "fact." While I believe that to be true, the second deal is what really solidified my confidence as a real estate investor! This property is rented for $1250 per month.

What made you interested in investing in this type of deal?

Rich Dad Poor Dad has a CashFlow Classic game online where the goal is to buy cash-flowing properties and escape the rat race. That game is what inspired me to buy rentals!

How did you find this deal and how did you negotiate it?

I found this deal on the MLS. It was a 200+ day old listing. When I reached out to the seller, I had been looking for a property that met the 1% rule in the Broad Ripple area of Indianapolis with no luck. I had finally found one! The seller said he already had an offer he was about to accept and he wouldn't have time to show me the property that day. Without being able to see it, I wrote him a full price offer that day sight unseen. He said that was weird, but he was interested.

How did you finance this deal?

I used a traditional mortgage for an investment property that requires 25% down. The offer I was up against was all cash, so the seller was leaning towards accepting the cash offer even though it was lower. The seller actually had two financed offers fall through on this property already which was why it was on the MLS so long. He was ready to be done with this property and my finance contingency made him uneasy.

How did you add value to the deal?

I picked this house because it had a unique draw to it. It is near Broad Ripple Village which is a popular place in Indianapolis for college students and young professionals to pair up and rent houses as a group. This house had 4 bedrooms which is rare for the area - most houses have 2 or 3. I made sure to post professional photos when writing my rental listing and was able to rent it for $150/mo above what the previous owner was getting without me doing any additional work to the house.

What was the outcome?

The seller and his wife googled my name that night and found a random video of me on youtube. I later found out it was a video of me from college talking about the importance of leadership training. Completely unrelated to real estate! They liked me and decided to accept my offer. I couldn't believe it!

Lessons learned? Challenges?

Don't bend on your background, credit, & income requirements. My first residents were a young couple that opted for a 3 year lease. One met my requirements and the other did not. Four months later they broke up and one ditched town. The other could not cover the lease on their own. They ended up finding another roommate. The second roommate also left town after 2 months! Instead of evicting, I let them out of the lease and found another resident. I stayed strict on my requirements the 2nd time!

Hi Ethan, great question. Also Merry Christmas! Sorry for the delay I haven't been on bigger pockets for a few months. Our support team is active daily on our website and in-app chat, so I hope you were able to find your answer already! The answer to your question is if you pause or cancel your DealMachine plan, your mail campaigns will also stop sending out. Let me know if you have any additional questions!