All Forum Posts by: David Stone

Thanks for the warning. I am not a fan of subject to but I never really thought about consulting an attorney about structuring one... maybe a strategy for when i am more experienced.

Sweet! I am definately listening to that! Thanks.  This helps when future leads come across!

Thanks

So, is there not a market for people who are looking to find cash flow properties with some equity that they can pick up for little or no money down (not looking to flip)? My thought was that it could be picked up for $113k today on a lease option, the lease could be sublet to a tenant who will pay the mortgage and provide cash flow, it is in a market where prices are rising, and when it is time to exercise the option to purchase the value of the house would be higher than the $130k comps are showing today.  

@Jacquelyn Sarpong, I sent the letters searching the county assessor site for absentee owners in my area.  Its a small area and about 200 letters covered it.  I didn't use a service like ListSource or anything so there were no perimeters to adjust. 

Thanks @Chris Boyd, just for future reference where would the numbers need to be in this deal to make it something worth pursuing?  Thanks!

I am relatively new to real estate investing (we have four rentals) and am brand new to wholesaling.  I sent out a yellow letter campaign in my area (Grays Harbor County, WA) and had a woman call me back about a certain property.  My intent was to wholesale it.  I was hoping to get some insight on how I might structure this deal to make it a real deal.

The property is in zip code 98541

It is a 3 bedroom 1.5 bath single family house located in town

The property is in need of some work.  The roof appears to be in good shape.  It needs some patch work on siding and maybe some paint.  I have not stepped inside the place since I am still early in the process with the owner, but she did describe "holes in the walls" from the tenant. 

She rents the house out, but the tenants are not taking care of the place and it doesn't sound like she is getting full rent each month.  They are month-to-month.

The woman doesn't know what to do and just wants to get rid of the property.

She said she owes $113,000 on the mortgage and according to my calculations the comps in the area are $130k on the low end for same bed/bath and +/- 250 sq ft.

BUT... rent in the area for a similar property is $1100/mo.

Obviously this is not a great cash deal and couldn't be flipped (at full price offer)

Are there investors interested in wholesale deals on properties that could be bought for ~10% off and produce positive cash-flow. (If I can structure it zero down and reasonable monthly payments)

My best guess was that IF this could be a deal, it would have to be constructed using a lease option.

I am open to any feedback (as I am new to wholesaling and this will help me structure future deals).  If you need any more info I may have forgot to post, I would be glad to post it.

Thanks!

Dave

@cj Juan, life in Elma is good. It's quiet and never any traffic. See you at the meet

I am so glad there is a meetup closer to where I live!  Thanks for putting this together.  Looking forward to being there!

Maybe you could pay off one rental to collect full rent/increase cashflow and use the rest of the 401(k) money to invest in more real estate? Assuming your properties are performing well and you are trying to minimize risk as a worse case scenario. 

Hey BP!!  We have a property we have rehabbed and are considering renting and pulling out equity to pay back our private loan and fund a new deal.  

We talked to a credit union about obtaining a line of credit on the property and were told that we could either take the tax benefit of showing a loss on paper (and have no documented income from the property which would not allow us to obtain a loan due to our debt-to-income ratio) or NOT show a loss on the property and count the rental income as actual income.

Has anyone run into this problem?  Is it true that you can not enjoy the tax benefits of a rental property if you plan on pulling out equity to fund future projects?

Thanks in advance!