All Forum Posts by: Greg C.

The fact that there are a bunch of lots available in this Colorado town would actually make me a little nervous, although the idea seems creative and interesting.

There are places here in the Smokies and Blue Ridge Mountains where subdivisions have been platted for smaller houses, but none were ever built. I have seen lots of these parcels on delinquent tax lists, and even some listed with Realtors for under 10k with little interest from buyers. I think the issue with these subdivisions is that they were always speculative without a committed buyer base. 

I'm not a developer, and what the OP is doing seems very novel, but I am not sure who the target demographic is for something like this. If investors looking for STRs are the desired buyer, will these units be offered at wholesale prices? Are there other comps nearby that are similar in size that could be used to demonstrate proof of concept? How accessible would these tiny homes be 9 months out of the year to tourists?

There are lots of variables that you may want to share that would influence the advice you recieve. For instance, are you looking for a turn key rental or something underpriced that you can renovate and rent out? What is your ideal renter demographic? College students, working class families, middle income renters, etc.

Fundamentally, it is important to understand that Indiana is an incredibly heterogenous/diverse housing market. NW Indiana is closer to Chicago in terms of culture and housing stock, with a bigger blue collar employment base and many older bungalow-style SFRs. 

Then there are all the college towns. South Bend, Bloomington, Lafeyette, Muncie etc. These towns cater to students, but in older more mature neighborhoods, there are also opportunities to rent to academic staff and faculty.

And of course, the big elephant in the room is Indianapolis and its N. Suburbs which are growing and popular for investors. 

I would encourage you to consider Indiana as a collection of many smaller markets. You should be researching each one of these markets individually and trying to determine what city and neighborhood is right for your business model.

Edit: Personally, I think Muncie/Yorktown near Ball State is one of the most undervalued areas in the state. You are always going to have a constant flow of educated young academics/professors looking for housing here. And out-of-state investors do not know the area very well like they know South Bend and Bloomington and other major college towns.

I think that you should be consulting a local lawyer with a strong knowledge about MN assignment contracts, rules, laws, and regulations. They can help you tailor an air tight contract that you can use over and over again. IMO, making your own contract could be risky if you don't know what you are doing.

Many lawyers will do a free 15-20 minute consultation, where they can give you a quick lay of the land. It is also a good idea to develop these relationships, since you will likely need their support at closing as well. In NC, lawyers also do title searches, which is incredibly important. Not sure if that is the case in MN, but they can probably still point you in the right direction.

Human philosophies are filled with stories that warn against blindly following the same trodden path as the masses for good reason. Being a member of a massive pack is a good way to get trampled.

Wholesaling has merit, but like anything, it has to be done with close care and consideration. Unfortunately, this is not the message that is shared with the masses. Most people are lured in with the most basic of knowledge and a 'just wing it' mentality that is propagated by certain corners of the internet outside of BP. The end result is legal headaches and bad deals for all parties involved.

It has been a year since I started my real estate journey. It has been slow, but I see myself at the start of an exponential curve. The early years require deep reading, the development of systems and processes, and some carefully structured deals that are done with good due diligence. It also necessitates an understanding of the law — and at least a tacet understanding about where being an investor ends and where needing a licensed agent starts. After reading stories like the one in the OP, I am glad that I found this community and have continued to educate myself.

Finding someone to build an 80k stick built house in this day and age is going to be very hard, even for a tiny cottage. I've been talking to a few builders here in NC, and even for a 1000 sq ft bungalow my costs are going to be over 140k bare minimum. If the area allows manufactured homes, that could be an option as @Mike Dymski says. But many municipalities do not, or require special permitting. Modular is also getting more pricey from what I have seen — but perhaps you could plop down a modular duplex or triplex to double your potential rent income.

If the plot is zoned residential, and on a local street, it may be difficult to find other uses for it. But if it is along a thoroughfare and/or in an area without strict zoning I can see more possibilities for you. You could lease to a billboard company (if allowed by the local muni), you could also build a small commercial property like a steel garage or corner store for less than a new residential build.

I'm also in this process now, so it will be interesting to see what direction you go.

I think that your case against the former seller may have some merit if you can prove that they were aware of the problem prior to selling and did not disclose it. Check with the Engineering and Inspections department in Danville and ask for any past property records/violations that they may have. Even going back 20 or 30 years. This is something that is often poorly tracked by municipal governments, and it may not have been reported to you with the most recent failed inspection. 

Unfortunately, I could not convince my large national banks (PNC, Truist) to write this kind of letter. All they would do is a generic POF letter. Serves me right for working with large corporate banks. I am going to open an account at a smaller local bank in my community and start moving over certain assets. I'd imagine receiving a guaranteed fund letter is easier for larger institutional folks, or people who closely coordinate with their local bank branch on frequent transactions. I can see that almost a dozen folks have registered for the auction. So certainly, some people have been able to get this kind of guaranteed letter.

I am going to submit the POF letters, along with a personally signed and notarized letter that I write guaranteeing payment. Not sure if they'll accept it, but its better to try then to give up.

Thanks all for the feedback.

@Bruce Lynn. I contacted the county tax office. They were nice enough to send me a letter of what they are looking for. Basically it is a proof of funds as @Chris Seveney indicates, but with a guarantee of payment from the bank. The first part shouldn't be that difficult to attain, but my business bank may give me a hard time with the guarantee. Their customer relations have gone vastly downhill since COVID, and they don't exactly like dealing with non-standard requests. May have to go to my personal bank instead if the former doesn't work out. I can always dangle them putting a hold on a couple thousand dollars to get the guarantee as @Bill B. suggests.

Hello All,

Hoping that someone here may be able to offer some advice. One of the Indiana tax lien auctions I am interested in taking part in requires a letter of credit. The auctioneer website says the following: 

Please provide a letter of credit from your banking institution on official letterhead signed by bank officer/employee. The letter must indicate that you or your business is/are a customer in good standing. The bank will honor and guarantee payment to the County Treasurer for any purchase made at the tax sale auction up to the amount of $_______________. This commitment to assure payment should not expire less than 30 days from the date of issuance.

Is this a standard requirement for tax lien auctions in the State of Indiana? I understand that each county sets its rules, but this makes entering the auction far more complicated then I had originally thought it would be. I have never had a letter of credit issued by my bank before, and am not even sure what metrics they look for in such an agreement (i.e., Credit Score, Account Balance, etc.) nor am I sure how long the process takes. If anyone has been through this and would be willing to offer some advice, I would deeply appreciate it.

I have an opportunity to purchase a parcel of land that straddles two counties on the outskirts of the RDU area.

One of the counties has strict zoning ordinances, and the other has no zoning at all (except in municipal areas). I would like to use the part of the parcel that is in the county without zoning towards a energy development project. My problem is that this sort of development is not allowed in the county that has zoning.

If I were to develop this project on the unzoned side of the county line, would I get in trouble with the other county that has zoning regulations?

I hope my question makes sense, has anyone dealt with a situation like this before?