All Forum Posts by: Dustin Allen

@Jacob Hornberger

Always on every property no matter what type it is. 

@Johnathan Lewandowski

If your agent is not doing what you ask, talk to their broker. They are the only ones who can do anything about it.

@Juan Ayala

Get the hard money guy to write a preapproval letter for you. No reason that they can’t.

@Ralph Ace

As long as you follow your states marketing guidelines, you shouldn’t have an issue. I would look those up and then run it by your broker before publishing. Lots of people are doing this already.

 There are unlimited resources on this site. Start reading everything you can about long term investing. Look up the “core 4”. Figure out where you want to go and why and then start investigating your target market thoroughly. It’s not easy but it is a simple process. Learn first then do. If you try to just throw money somewhere, it’s going to be like playing roulette. You might win, you might not.

Take some time and make a solid plan. You’ll likely want to travel to your ultimate location first and learn more about it. Find some meetups in the area when you do and talk to as many people as you can. Talk to the coffee shop employees and the hotel workers where you stay. Locals always know what’s going on in an area.

@Russell T.

There is no wrong answer here. If you and your wife are more comfortable buying rentals outright in the Dave Ramsey fashion, you’ll likely be able to save up for the next one faster or at least a down payment for the next one faster. You will have a higher cash flow and be able to handle any unexpected repair costs or capital expenditures.

Keep in mind that you could always put leverage on the property after the fact. It will be at a slightly higher interest rate than if you used a purchase money mortgage to buy in the first place. Nothing wrong with starting out safe. People will scream at you about “opportunity cost” but you’re also buying peace of mind.

If you do choose to leverage and buy more than one, be sure to hold some in reserve as you should for every property that you buy. Run the numbers and be very realistic. Make sure there is adequate cash flow to handle unexpected vacancies or repair costs (they will happen eventually).

Either way, you’re in a great position to get started. Run multiple scenarios and sit down and go through it with your wife. Pick whatever let’s you both sleep at night and learn everything you can along the way.

@Jamie Mosley

Keep in mind that, regardless of what other agents on here say, you can always have your own agent present an offer for you. The California Purchase Agreement now has a specific section to say whether you expect the seller to pay the buyers broker commission. This is useful in situations where your agent might not be a part of the same MLS and the listing agent isn't automatically required to share commissions with your agent.

Unfortunately, there are probably agents out there who would delay or even not show your offer to the seller if they feel so entitled to be a dual agent on the deal because they found someone who doesn’t require them to list it publicly.

Again, I don’t often see a big problem with using a dual agent. I might if they seem more concerned with getting double commission than with fulfilling the fiduciary duty they already have with the seller. Doesn’t give a lot of hope that they would be so concerned with their fiduciary duty to you once you sign the contract. Go with your gut. Better to lose a good deal than buy a bad deal.

@Jamie Mosley

The benefit of off market deals to you as a buyer is not having competition and being able to negotiate one on one with the seller. This can be done through one or multiple agents. There are any number of reasons a seller might not want the house on the MLS (celebrity, domestic concerns, etc…).

See what the agent is offering and ask if they are willing to pay a buyers broker commission if you were to bring your own agent into the deal. Then you can decide if you want to use the same agent or your own. Nothing wrong with using a dual agent as long as you understand they won’t be able to advise you whether the seller will take less money or other privileged information.

@Gurjot Grewal

You should be looking for the exact same things that you would look for when using financing. The appraisal is less of an issue as that is to give the lender a third party opinion that they aren’t lending too much on a property. Obviously, if you overpay by a lot, you may have issues when the appraisal is done for your financing later.

You will still want to have inspections or at least a good sense of the condition of the property. This could be done by walking the property with your contractor or hiring an inspector if your contract allows an inspection period.

A standard contract should cover the fact that the seller needs to be able to pass clear title to you as a condition of closing. This should all be handled by the title company according to your contract.

Everything always comes back to the contract. What are you and the seller agreeing to in the contract? That’s where the bulk of the negotiations should be happening.

@Bruce Reeves

Sounds like you’ve put a lot of thought into this already.

One suggestion would be to run a few more scenarios where the buyer pays off the seller financing at 1, 3, 5, and 7 years and see how those might affect your appetite to go that route. Not many buyers are going to go with seller financing that has a prepayment penalty (you might find one). So at least account for the possibility in the even rates go down over the next few years and they choose to get traditional financing after they have some rental history on the books.

Either way, looks like you’ve done a good job and you’ll make a smooth exit one way or another. Congratulations!