All Forum Posts by: Garrett Hogan

Ayana congrats on getting started. As youre starting out, figure out what type of value you can bring to the transaction if money is not one of them. Can you manage the project, are you a real estate agent who can get it sold, can you find the end buyer? Figure out what your value is, and bring that to the table. You may not be able to get 50/50 but you will learn a ton and develop credibility as an investor. 

Another thing to consider when starting out is to wholesale the deal to another investor. If its a great deal and it turns out well for them you could build the relationship with them so that you can partner on the next deal in the future. 

Can you post a better picture showing the whole bathtub and scene? That maybe helpful. I havent heard of any acrylic repair products but maybe a bathfitter type of tub where it goes over the old tub might be a solution?

@Rich Stevenson makes a really good point... Most good contractors and subs don't shop at home depot. In fact, I've made it a goal not to shop at home depot for anything other than the last minute punch list stuff at the end of a job. It's such a time suck going there, picking out stuff, loading the truck etc. This is way less efficient than calling my lumber rep, giving him a list of what I need and having it show up on site the next day. 

Let me preface this by saying I am not an attorney, CPA or tax adviser and you should consult those types before about this situation.

In the past I have setup an LLC and created an operating agreement with all of the investors that spelled out everyone's interests and roles. This was an entity with 3-4 investors in it who were all friends/family who could AFFORD to lose the invested money and are savvy individuals who have made previous investments and understand the pros/cons of investing. In this deal it worked for me.

However, I would caution you about doing this if you do not fully understand how the process works and will be taking on investors who do not understand the risks involved. The last thing you want to do is get sued or investigated by the SEC for selling securities to non accredited investors and be banned from raising money ever again. 

There are some SEC/Tax attorneys on this site and I recommend talking to them or finding a local one to discuss. SEC docs are not cheap, but can be modified and reused for other deals in the future. 

@Chris G. I do not have any experience with New American Funding, so I'm not sure about them. However, I have done probably a dozen deals with Guaranteed Rate and have had nothing but positive experiences so far. They are very organized and have a great process and team in place to move the loans through the process to closing. I typically always recommend them to friends and family who are looking for mortgages for their personal residences. 

Shawtawni, congrats on taking action and potentially getting your first deal. Provided that you have already done the comps and the asking price is reasonable, I would go ahead and get the property under contract with a $500-1000 earnest money deposit pending a "satisfactory walkthru with a contractor" or some other type of out. Then walk a few contractors through and have them give you estimates. If there is reluctance to do so, which there maybe becuase you are a new investor, you can offer to pay them to do the walkthru and write up an estimate. This will help you figure out rehab costs. I would also recommend you use the deal analysis tools on this site to give you an idea of all the other costs involved. 

I did my first flip back in 2012 and looking back, I had no idea what I was doing. However, once you take the initial step, you force yourself to learn and move forward. Had I not taken that uncomfortable step 5-6 years ago, I wouldnt have been able to accomplish all the things I have today.

GOOD LUCK!

your best bet is referrals from other freinds/families etc. That will give you a good start, but most of these guys will be overpriced. I recommend networking with other investors or stopping by other jobsites and getting contractors info. 

Once you get one trade, ask them for referrals for other trades. For example, ask the electrician for a plumber and HVAC guy. Ask the painter for a good drywall/plaster guy or finish carpenter. Ask the tile guy for a hardwood floor guy. Basically, any trades who are on site at the same time, or follow another trade should be able to give you good recommendations.  

Whatever you do, DO NOT USE Craigslist for anything other than a day laborer who is performing a low skill job. Any good contractor is busy and will not be looking for jobs on craigslist. Those that are are either scammers, or really bad at what they do. There maybe exceptions to this rule, but not worth the risk IMO.

@Bab Adetiba the posts above all give sound advice, so I will try to add additional.  I too am working on my first syndication 194 unit multifamily deal. I've done a ton of research on different equity splits and structures and have found that a 70/30 split with an 8% pref return paid back to investors is pretty common. Obviously, that number changes depending on what each person brings to the deal, but is pretty fair for the situation described. 

In addition, I would encourage you to take a 2-3% acquisition fee on this since you put the deal together and found the money. 

Lastly, who will be managing the asset? Who will be doing the property management, you or outside company? These are all things to figure out before you close which you can also charge additional fees for. 

@Pavel Sakurets  Regarding the 02301 Brockton property, I would recommend contacting Adelino Vicente at Vicente Realty. He is the broker and also a RE investor. Im sure he can help you out as they do a bunch of business in Brockton. http://www.vicenterealty.com/agents/2-adelino-vicente

I always make sure to get 1099's filled out at contract signing or by the time I give the final check. As most mentioned its very difficult to do this after the fact. I would encourage you to do as it is a good practice.