All Forum Posts by: Eric Thomson

So I've recently rebuilt my website and have apparently stumbled upon some magic keyword combination that has gotten me more leads than normal over the past couple of weeks... The problem is that they are all, on average, about 5 hours away from where I am. I have no interest in trying to flip or buy and hold something that far away at this point so I would like to wholesale them. Would you (or HOW would you) wholesale a property sight unseen? Would you send the leads to local investors with the promise of a finder's fee?

Rolanda,

If you haven't done a HomePath investment before, I think you'll be pretty pleased with the program. My wife and I bought one as our primary residence while we fix it up and sell it. It was unlike any other foreclosure process I've experienced. Much easier, less time consuming, no PMI (which is increasing again in April - and you'll have to keep it for the life of the loan), can own up to 10 properties... It would be nice to use the HomePath renovation mortgage, but I had similar issues finding any lenders that offered that portion of the program in my area too.

Hi Paul,

I'm no guru, but I like numbers, so here's what I've got:

The 2% rule would suggest that for that purchase price you would want rents of around $6,000 per month. The 50% rule would mean of your potential $1,800/month rent, $900 would be available to service your loan, so you would come away with an estimated -$172/month.

If you're confident in the numbers to flip the property and make at least the $60,000 from the 400 sq ft conversion I would suggest going that route. Your lender may not be happy about it if you are going conventional (especially with 0 points).

K. Marie Poe - HAHA!

As far as listing a vacation rental, homeaway.com and vrbo.com are great sites. I'm not exactly sure what you are wanting to do with your flip property but sounds like you want to keep a blog for people to follow your progress? You can get a free blog through wordpress or various others...

Also, $250/month is best case scenario. That is not calculating vacancies, repairs, etc.

Chandra, I have invested in a couple of town-homes, which are condos without the maintenance fees, and have made some decent money both in rent and in return when I sold them. The answer I would predict you will get most unanimously on here would be that the high maintenance/hoa fees and the slow appreciation of condos make investing in them a bad (or at least risky) idea. I think it can be done if you buy far enough below market value, but with so many carbon copies of your condo in the complex they just don't appreciate as quickly as detached single family homes.

How much land are you talking about? Could you put several mobile homes on it? The biggest issue I could think of you having is the high cost to the tenant of having the mobile home moved out there. If you came across one cheap you could move it out there and could sell/finance the trailer and lease the land...

I wouldn't consider myself a seasoned pro, but I'll throw in my two cents. Do you have an idea of the value of the house as is? If it's more than $15,000 then I would consider selling it (at that point your increase in value becomes less than your repair costs). Otherwise I would do the renovations (maybe take a closer look at that renovation budget to see if any cuts can be made and wouldn't renovate to sell when I intend to rent) then I would rent it out.

If you know you will get $700/month based on the comps then, looking at the numbers, you will have an immediate return of $15,000 in equity (minus the pre-renovation equity you currently have). I don't think that the 50% rule will apply to a house with no note, so I'm guessing you would be netting close to $6,000 - $6,500 per year before considering your finance charges. So about 25% ROI conservatively. That's not bad.

Baltazar Camacho that is not typical for my area (which is practically the same area as Chuck Redman). When looking for this home we were searching almost exclusively for Homepath properties and on numerous occasions we lost out in multiple offer situations. We were competing with every other retail buyer, but I think that is still a pretty decent indicator). There are some that are priced high but there are many that are well below market and go quick! We purchased ours for $160k and appraised at $215k. We're coming up on 2 years and ready to sell and the comps are putting us close to $230k now.