All Forum Posts by: Gary Dale McKee

3bd 1 1/2 bath, 1,600 square foot.

REO with asking price of $56,000

I want to offer $42,000 on the property.  It is in a good location and would make a great rental.

Rent $750

Taxes $65 

Insurance $60

Repairs 5% = $38

Vacancy 10%=$75

CapEx $100

Monthly expenses = $336

Mortgage for 10 year loan at 6% interest rate, with 10% down $444.08 for a grand total of $780.08.  I have used pretty conservative numbers.  It doesn't seem to work on paper, have I missed anything?

Didn't mean to post that again.  I think that will get me headed in the right direction.  If I run into any snags I will hit you up. Thanks again. 

@Claire Trammell Thanks so much! That is exactly what I wanted to know. You are awesome. 

@Claire Trammell Thanks so much! That is exactly what I wanted to know. You are awesome. 

Since I am new to the business and have had some trouble finding properties, I am going to start sending letters to owners of properties that look in distress. 

• what does the letter need to say.  

• how does it need to look; does it need to have a picture of me, or can it just be in standard letter format. 

• is there any legal concerns that needs to be addressed. 

A very good friend of mine and I are in the beginning stages of creating a partnership. Neither of us have any experience to speak of in investing in real estate.  What would be the main things we would need to sit down and hash out right from the get-go so that we are clear on each other's roles in the business. After the roles of each have been established, what type of legal document would need to be put in place. 

@Michael Lee

Thanks for the reply Michael and I am just thinking over some of my options for financing my investments. I do have 15k saved up for investing. I am just thinking down the road at how I could fund more deals when my capital runs out. I have a pretty stable job with American Electric Power as a power lineman. I am 32 and outside of a yearly Union raise I am at the max earned income I can reach from my job. I have kicked around selling the place to get the money out and invest it so I can reach my goal of quitting my J.O.B. faster.  

Sure isn't much talk about it.  There are new apartments and the like being built in my area all the time. If they where not making money I wouldn't think they would be building them.  Maybe people would rather just buy rather than have the hassle of building?

I have also been thinking of doing this in my area.  I built my home myself and have wondered if I couldn't just built my rental properties. I have asked several agents in my area and they don't think it would work but they can't give me any hard evidence, for or against the idea.   

Ahhh I see, thanks for the information  guys.  I want to verify that I am not making a bone head move by thinking about using the equity in my home.