All Forum Posts by: Tony Gonzalez

Hey BP!

Have a situation I am looking for advice on:

A good friend of mine, who lives in the Bronx (NYC area) is selling his house. He's desperate to sell. It's a duplex MF, a one bedroom apt on ground floor with driveway (no garage), and a three bedroom on second floor. His current mortgage is about $2K per annum, rent from 1st floor is $1K, and I'm sure one could rent the top floor for close to $2K (appliances are from early 2000's)

He hasn't even officially hired a realtor yet, though one is in the wings, she'll have hard numbers for me by Thursday next week. Right now, he wants to sell the house for about $420K (It's extremely close to trains to Manhattan, and bus to White Plains).

He needs to sell yesterday, so I am trying to research how to do that, without it hurting my bank book. Perhaps I go about assembling a team of investors who would buy the house and fix it up for rental (or resale)? Is that even a good idea?

I guess I am seeing it as a gold opportunity to segue into REI, but as ya'll know, funds are tight on my end.

Looking forward to hearing ideas. Or the cold hard truth. Whichever :-D

Not sure, but my GPS says "Make a right at the corner of Cheapskate Ave, and Inexperienced Boulevard"

Welcome to BP, @Jennifer Chevez!

Also getting started on here,

Definitely read, google, delve in all you can.

As for finding a mentor...well...they say that success leaves clues, and there are folks on here, and IRL who will be willing to show you the ropes. Never too old for a mentor :-D

Thannk you!!! Could not have said it better myself.

Some sleaze ball contractors out there...sure...but most are putting food on their kid's table with the work you give them.

Contracting, in any field is hard work, worse for GCs. Half the year you are scrounging for projects, the other half you are flooded (depending on the climate you are based in, like NorthEast)

Being a landlord, investor, property manager, is also hard work.

Pay the guy/gal a fair deposit, make sure they are happy, and make sure the contract protects both of you.

Throwing spaghetti at a wall here, but....

A) the other 70%, B) a good reputation, C) repeat business, D) referrals, E) all of the above would be incentive enough :-)

If this guy went through the trouble of bonding and licensing and being above board, I wouldn't worry too much about the deposit.

You can also protect yourself by adding penalties in the contract. Major construction companies do this when vetting and hiring sub-contractors. "Here's a penalty of X amount of dollars for every day you are behind." or "If you gotta re-work something that has nothing to do with a change order, we aren't paying for it."

Hope this helps!!

Side note...I am an IT Contractor, and depending on the job, (Installing new server rooms, etc.) I require a deposit up front too. I know...apples to oranges, but just understand that alot of contractors incorporate deposits in their business model.

Best of luck!

From my personal experience, I think that Dave has great concepts, but not EVERYTHING is practical for all situations.

I used ot be all "All credit is Bad Credit!" and blah blah blah...

Fact of the matter is, I learned that the snowball method is a good methodology, but I don't follow the steps in the exact order he does.

His steps

1 )Set a baby emergency fund of $1K

2) Pay off all debt except mortgage

3) Save 3 to 6 months

4) Invest 15% into Roth IRAs and pre-tax retirement instruments.

5) Fund college fund for kids

6) Pay off Mortgage Early

7) Invest and Give

My Steps?

1) Save $1K for emergency fund. Done

2-3) Save AND pay off debt concurrently. So basically, half of the remainder I have left after bills and such are taken from my income, goes to savings, half goes to debt.

4-5) Like 2% to 3% of my net pay gets put into College savings accts for my kids, and like another 2% percent to retirement. That's happening concurrently (while paying off debt)

6) Don't have a mortgage yet, but I definitely would look to pay it off ASAP. However, based on my calculations, waiting to do cash only purchases, won't make sense when I am doing MF purchases of say like $1-5MM. Based on what I am reading, leverage business and finance law (like being an LLC, corp etc.) and making smart moves with money (reusing money to get properties etc) I'm pretty sure getting out of mortgage debt won't be too difficult

7) Investing , already doing it as part of Steps 4-5. Giving...since day 1.

Summary, he has great ideas, just tweak them to work for your situation.

Hey there!

I am in the same boat as you @Hermilo Garcia. Novice. Newbie. Wet behind the ears. 

I asked a similar question here about a month ago...the wisest response I got so far (apologies if the person who told me this, reads this, and gets sad they didn't get tagged for credit)

1 - Learn all you can. Google. Ask questions on here. Look for meetups. Look for books. @Brandon Turner has a great book (The Book On Investing in Real Estate with No (and Low) Money Down)  I bought it Amazon for a few bucks. Tons of others.

2 - Save money up. Like three to six months worth of gross pay. It's much easier to get into risky REI knowing that you have three to six (lots of experts say 9 to 12 months) of cushion. Cut back expenses (I am doing that now) and if you have to, pick up a side hustle or second job (as long as it doesnt affect your family life or health.) I work a regular job, and like once or twice every three months, I do a gig on weekends. I'm talking Putting-Ikea-Tables-And-Chairs-Together-For-Startups-Cuz-I-Need-The-Cash jobs.

I was all eager to jump in, "I got a dollar in my pocket, how do I buy a Multi-Family!"

Til reality hit me...gotta have a fall back cushion first.

And yes, I thought of asking my family for financial input, @Max Fisher, problem is...my extended family is so fraught with troubles and fragmentations, that I wouldn't even ask them to invest in a cartoon of milk with me.

I just squeed with delight.

Guess I'll have to link up with more colleagues, won't I 

:-)

We both are excited about it, because we watched Property Brothers, and Income Property on HGTV. She has her own passions, etc. Which I am supportive of, and I am into REI...at this stage I am just learning.

We both agree, that a) as long as what we are into makes us happy, b) there is some kind of profit, and c) risk of financial injury is low, then she is on board with REI.

For instance, I wouldn't even think about getting a property, even with zero down, without having six to nine months of cash stuffed away. No one touches the emergency fund, unless it's car trouble, medical emergency, or someone needs lunch money (look...I like eating out when I am at work LOL). I also maintain a well paying job, in a career that is solid (boring as mud, tho). She also does freelance. 

I'm not rushing into anything RE related, but I keep her in the loop about every webinar I go to, Meetup I attend, technique I learn about. What helps is that her dad was a big time home constructor in Jersey back in the 80's and 90's...so she has experience with the industry. Somewhat. I have...slightly less. Couldn't rent a base board to a mouse, if you would.

But, so far, so good. 

Good Evening!

This thing on? (taps mic)

Hi, so as some of ya'll know I been really learning about REI, I go to school for Construction Management, Property Management, AND Business Management...and I am looking to network with like minded individuals.

As such, I happened onto a Meetup last week, by a company called Renatus Realty...and basically, they are asking people to pony up $20K (either thru financing, selling their seminar classes, loans, or flat out cash) and get access to investment network, leads, classes, tips, and strategies.

I liked the vibe, but...don't have $20K laying around...and I don't like debt. My partner and I been working hard to actually pay off debt and save (car note, college, old loans)...

Has anyone worked with this company, or similar? Is it a smart investment? Or should one say "You know what...let me just stick with what I can find on my own..."