All Forum Posts by: David Dachtera

@Chris Milan ,

People who are behind on taxes don't "go into foreclosure", their property can be sold for the back taxes, usually by the county. How the tax sales happen varies from one county to the next. Inquire at your county offices to see how it works in your area.

The county should have a list of properties going to sale for back taxes. Ask at the county offices.

"Foreclosure" is usually associated with lenders or other lien holders who are suing for foreclosure in an effort to collect money due to them for whatever reason.

I may have missed it, but I didn't see mention of business credit scores.

The big one is, of course, D&B. They compile a score for your business called "Paydex". It's a scale from 0 to 100, where 80 means you pay as agreed. That's the minimum score you want to target. Always pay before the due date!

There is also Equifax and Experian business. I don't have that info top-of-mind, but they equate roughly to FICO in the personal credit world, only they deal with business credit reporting.

The big one, though, is Paydex. Buy stuff on Net-30, pay it on time and build your entity's Paydex score. Someone posted a list of vendors with which to build your entitiy's credit base earlier in this thread. When you have 7-10 such lines established, that's a good time to start looking for business credit cards.

When you have business credit cards carrying balances and paying on time, THEN you can think about tradelines with vendors like Staples, Home Depot, Menards, Lowe's, etc.

One of my mentors actually teaches business credit: how to establish it, how to build it.

I'm hearing that BofA is one of those lenders who is acquiring a reputation for calling the note due to a change of deed even though the payments are current.

This may be a chance to refi and transfer it to your entity in the same go.

You can also check with the county and find out about the taxes. If the owner is keeping them current, you can find out where the tax bills is being sent. If the taxes are delinquent, see if you can pick it up in a tax sale.

For what it's worth, one of my mentors does it this way:

1. Buys a property under market having subtracted his profit, repair estimates and selling costs when formulation his purchase offer.

2. Rehab, gets a new appraisal, then refinances BEFORE selling to pull out all his money into the deal (and some profit, not all of it), and uses that money to get into the next deal.

As you might imagine, he's very selective of the properties he offers on and is a skilled negotiator.

Well, for what it's worth @Sheena Varghese, I don't like the numbers and I don't like the seller's insistence on carrying the note. You already found out about no permits, that leaves the zoning question and the inspection. 

If it was me, I'd be dinging the seller on the no permits - even if it's not their fault - and lowering my offer. Bad inspection outcome? Lower still.

Don't "marry" the deal - "it's just business". If it doesn't make business sense, don't do it.

WHOA, Conway! I feel your pain. If I could walk outta here forever today I'd do it in a heartbeat.

That said, Brandon Turner makes a good point: look for SOME kind of RE-related job, even if the pay is minimal. That at least begins the transition.

Look around your area for a REIA (Real Estate Investor Association) meeting and start networking with people who are already doing it.

Also, I'm a big proponent of getting educated. As someone wrote in response to a forum post of mine, "Learn Real Estate before you try to DO Real Estate". My post is in the "Starting Out" forum, "New Investors: Get Educated or Not?"

 In mortgage states, an attorney is required. In that case, you need both the attorney and the title company.

 I believe the paragraph after that addresses your question:

"To some degree, that's understandable. Thanks to the many ads we've all seen on TV, and what lies behind them, Real Estate Investing education has rather a bad reputation. It's generally considered VASTLY overpriced and it's also considered to over-promise and under-deliver."

Notice that it calls out "Real Estate Investing education" explicitly, then explains the reasons for that conclusion.

I may be wrong, but that statement seems (to me) to be congruent and consistent  with posts from you and from others. If I created an inconsistency or incongruency in any of that, by all means - do point it out. I'm always trying to improve my writing skills, if you can call 'em that! ;-)

In light of your flying analogy, I wanted to share this...

I drove from suburban Chicago up to M/Sp, MN back in early February, 1981. This was the ORD ATIS broadcast at the time:

" ... the 0710 weather: Indefinite ceiling zero, sky obscured, visibility zero. Temperature 32, dew point 32. Wind: calm. Altimeter two niner seven four. Notices to airmen: the airport is closed."

We drove the tollway up toward Wisconsin watching the lines on the pavement because you couldn't see 50 feet ahead of the car.  All the leading edges - the aerial, the hood ornament, the grill, ... acquired a good half-inch of clear ice.

As a potential student pilot, I did not consider it a "red flag" when my (future) instructor talked about restricted airspace with me and other potential student pilots lest one find one's self being "escorted" down by military aircraft and "detained" quite extensively, especially now as compared to when I was student flying in the early 1980's.

I'd have considered it a "red flag" if he hadn't, actually!