All Forum Posts by: Tom Spaeth

It all depends on how good of a deal you can find. It works great to go talk to potential buyers find out what they are looking for and then go pound the street to look for the deal. Many buyers will humor you. It rare that a new Wholesaler finds a deal that I would buy. 

Spend some good time figuring out what a deal really is. Most Wholesalers calculate rehab costs 10-25% to low and ARV's 10-20% to high. Do that a couple times and most of your buyers will ignore any deal you bring them.

But in most markets if you have a really good deal you can resell it on craigslist or so someone working in that neighborhood in a few minutes. When I have a good deal my buyers are asking if they can immediately drive a check over to my house without ever looking at the house.

Just be sure to get a bill of sale listing all of the car info including the vin number. That way you can scrap it. Should get you $200-500.

Nothing scary to it. I love the opportunity of things like this. This is free money in your pocket. I bought a house once and made sure the owner was well aware that I would take the 3 car garage exactly as is. It came with two old trucks. One was missing the front drive shaft. Neither were running. I drained the gas, cleaned the carbs, and made another few thousand dollars. Yes I had a little hassle. I had to take the bill of sale to the state. They made sure the cars were not stolen and issued me a new title.

Easy peasy and some extra pocket change. 

Rick, Great topic. I think most zoning makes little houses impractical. Only because you have to buy a rather large piece of land to put a really small house on. But every once in a while you see a very small lot come available in Denver and that may be worth a look at.

Of course as a realtor you can look at the real data. How many homes under 900ft are sold (and not flipped again with larger foot prints) in the market. I find that I buy small 700ft houses to put additions on to. They are easier to find because their is not a high demand for that size house.

While a very intriguing Green idea, I am not sure it is really viable. Small houses work or singles and couples. But I doubt many families will be in that market. While 4000 ft house may be considered to large I think 600ft may be considered to small.

I can say that I truely have no hard data for you. But I would say that if I was responsible for the house of a loved one I would probably not want to deal with it between Thanksgiving and New Year. Might actually expect an uptick in your response rate in January when they are hoping to start the year without last years burdens. Just a thought.

Addionally, here in Colorado It it not very useful to door knock 1-2 weeks from the auction date. If you found someone who said yep let me sell you my house, you very likely would not be able to get the paperwork completed in time. There are exceptions to every thing but theoretically you need 2 weeks here in Colorado to give notice to the county. Under two weeks and the bank could simlpy not respond.

I would love to hear from others door knocking foreclosures.

What's the condition of the tile. If the tiles are all in perfect condition you do not need to replace them. I don't think you even required to disclose. At least not where I live.

It may be possible to install siding over the old tiles. Not sure.

Pretty easy to get a bid on tering it all off. Then you know. Remediation is not that big of a deal. Just a pain.

Another big issue you need to watch. Many hard money lenders expect you to fund construction as you go and then they periodically reimburse you. Not an issue if your GC understands this and is working with you and you pay for regular draws. A lot more difficult if your dealing with all the sub trades or a GC with no credit. Many times they want to be paid weekly. And you may not have the money to pay them.

From the lenders perspective they don't want to give you money until it is locked into the property via labor and material. Nothing worse than a borrower taking the cash and heading out of town.

Depends on what you are doing. You have to look at the complete package of your deal.

6 months in generally to short. Give yourself 2 months to rehab and 2-3 months to sell and close. And you are up against a hard deadline. If your rehab stretched to 2 months your lender can get expensive real quick. And did you need plans and permits. In denver that can add 3-4 months to a project. You have to pay attention the cost to extend to loan.

12% is very reasonable. THe 5 points is on the high side. I always like to double the points and add that to the interest rate. Gives a general idea of the rate you are paying, So in your case approximately 22%.

Never paid an origination fee on top of the points. That takes you up to 32% rate for a 6 month project. Ouch.

I would look elsewhere. Bound to be alot of hard money lenders in your area shop around. If you have no experience the costs will be higher.

I would pay 10-12% plus 2-4 pnts no origination fee.

Depending on your project this deal is likely to put all of the profit in the lenders hands and none in yours.

What I don't get is why don't you change the locks. Then she will not have keys to the house. If you have not collected the first months rent she will not have a right to move in and it becomes a civil matter. (I would be changing the locks any way at this point)

Of course if she breaks into the house, the police may not arrest her. Then you have to get the eviction. And returning her deposit at this point would be cheaper

Always best to gauge if you are really going to loose money. Remember in a court of law it is not always about fair or what your contract reads. It may come down to a judge that says you didn't lose any money.

See you at the meetup