All Forum Posts by: Peter Haymond

@Chris Clother- Chris these numbers are actually directly from Marq but I incorrectly put in rehab costs because I thought I had to pay those out of pocket when I spoke with him. I'm actually considering Memphis Invest and/or the Jacksonville Wealth Builders for my monthly cash flow goals.

I know from listening to Than's videos that you own about forty something plus properties in several states and that's certainly a goal I would like to achieve through your business if possible.

I live very close to Tom Wilson who specializes in a similar business model but I like the property management you have set up at your business.

Thanks for the insight everyone.

I'll give you some averages I was told and please tell me if any of them are incorrect of if I'm missing anything.

Example property value: $100,000
1. Down payment - 20% of purchase + 4-5k in closing costs = $25,000
2. Property management fees - 9% of rent collected + 1/2-1.0 months rent collected as placement fee for tenant = N/A
3. Upfront repair costs = $16,000 (this is what I was told)
4. Fees for locating investment property - N/A (they make their money on the sale of the property)
5. Commission fees - N/A
6. Cash reserve requirements - determined by lender, most likely will want 6 months of PITI in reserves when you close = my estimate is $6,000
7. Other expenses - ballpark of 15-20% of gross rent goes towards maintenance & vacancy = N/A

Total = $47,000

This is just an example I used with the information I was given. I want to know how accurate my estimate is so I can focus on getting my first rental property. I'm well aware it's cheaper to buy rental property yourself as I grew up in a family who had rental property since I was little.

Thanks for your help!

Tyehimba - Thanks man for your help!

Danny - I love the last line you said, thanks for your advice!

Karen - How many rental properties do you own in Southern California?

Why I picked Memphis is because they have a turn key operation which is lacking in California.

Brian - I live in downtown San Jose.

Richard - Thanks for the advice. Wouldn't it be better to buy an $80k property out of state in Memphis or in Sacramento that will rent for close to that amount in cash flow instead?

Edgar - Awesome advice! I really, really appreciate the fact that you took your time to write up such a detailed and helpful response. I'm going to first focus on getting a better job and then moving to get my first rental. I'm speaking with Memphis Invest this week and although I'm aware they'll tell me I need more funds to invest, I'll keep being persistence until I can pull it off. One of employees there says he owns over 10 properties at a young age so I know this is possible!

Last August I graduated college and started a real estate investment business with two business partners. I did this full time for four months until the middle of December. We focused on making offers to REO's to flip but never got a deal done even with mentoring help. I got into debt and it stressed me out. After some personal issues, I decided to move where my girlfriend lives and take the only job I could find. My job is fairly low paying at a start up internet company that has a lot of growth.

My goal is still becoming a full time investor so I want to start a rehab/wholesale business again, but this time focus on setting up marketing campaigns to drive motivated sellers to call me; eventually expanding to more marketing campaigns and hiring employees. The end game is to use the active income from the business to invest in passive income and eventually start a lending business as well. I'm only 22 but I want to acquire my first rental when I'm 23 and work my way out of the rat race.

The tough part is that I'm surrounded by people who are poor (employees at work, friends, girlfriend, etc) and don't care about real estate investing. To combat this I decided to join a local REI and step out of my comfort zone.

My first goal is to make about $1,000-$1,500 every month in extra income that I can use on my first direct mail marketing campaign. I'm searching for new jobs in real estate/marketing/sales to make more money but it's tough and I get rejection letters frequently. What would you do in my position?

I plan to surround myself with busy, successful, wealthy people so I'm going to pitch at the REI to see if any older investors are looking for help then maybe I can partner with them on deals. I reached out to Memphis Invest and explained my situation, how I want to acquire properties, and where I want to go. They were extremely quick to email and call me about working with me when I applied on their website, but since Saturday I haven't received a response. I should wait until I have enough for a down payment probably. Most of the individuals in their testimonials are thirty plus and have good jobs or a successful business. I just don't want to wait until I'm over 30 to wholesale, sell, and hold properties.

So either way I need some help right now. I know if I want to acquire a rental in my financial situation I probably need to get creative with owner financing. I know I have to have discipline to do work after work to make real estate happen. I know now that I don't want to quit my job until I have a business that makes at least double my income even though all during the day at my current job all I think about is doing real estate investing. What do you think?

I'm sure plenty of you started out in similar situations although I'd like to hear advice from seasoned investors please. I've reached out to several investors online but most don't want to waste their time with me unless I pay them money for mentoring. I believe I can be successful and work in this industry now, that's why I'm asking for help now on BiggerPockets.

Thanks for your time in reading my long post. I'd be happy to help you if you live in the Bay Area.

Brian I am! You remember Carlos Bee Blvd still? Haha thats awesome! I'm graduating this summer.

Yeah I completely agree with you that you just need to get out there and do it. Meaning that innovation isn't the issue: it's execution. How many hours are you spending executing? Likewise you related that you need to get out there and talk to sellers like Matthew said which totally makes sense. By the way, I was totally blown away by the history lesson you gave me there on taking calls and how you advanced your career over time in this industry. I'm going to be proud to one day tell other new investors similar stories when I get older, knowing that less than 10% of them will actually enter the industry and less than 5% will become successful consistently.

It's all about setting up systems to build a repeatable profits business right?

Thank you again for your time and input on my question. I really appreciate it. Best of luck in your business this year!

Matt I appreciate your response. I'm definitely going to start young (hey I'm 22 right? what better time?) and gain experience this year by talking to sellers while dealing with objections. Thank you again advice man!

I'm graduating this August and will be working a FT job.

I've heard that 50% of sellers hang up if they reach an answering machine pre-recorded response. Now I'm not aiming this question to those of you who just started taking your calls live, which I understand is the best way to get experience & learn this business, but I would like to hear from someone who worked a j.o.b. and took sellers leads using a system to eventually run an real estate investment business full time & quit their job.

I understand after your phone system you can:

a. answer calls live (not an option for me until after work)
b. use a virtual assistant to answer your calls live
c. use a live answering service, like PAT live
d. use an answering machine
e. use an internet call capture service

Whatever the system is that works the best, it has to fit in my business model to create repeatable profits. The whole point of me doing this is so I can hit my first goal of $5000 profit or more per month so I can quit my job to run my business full time. I am creating systems so I can outsource a lot of the technician work to others I'll add to my marketing and operations team. I appreciate your input.

Great feedback here Jon.

Again excellent feedback. I need to "bust my hump for awhile" get a PT job, and start planning out a business model for after college.

Thanks for the reality wake up call Jon!

In other words you're saying don't market deals for wholesalers/rehabbers, find deals yourself and split the profit with someone else.