All Forum Posts by: Greg Moran

Howdy Amia, 

IMHO, it actually doesn't matter what method you used to purchase REI properties, as long as you've run the numbers, understood the rehab costs, and adequately planned for an exit strategy, etc. If you find that the numbers work out, I'd say go for it! You can find good deals in many places, and you can also find bad deals in all the same places. Foreclosure auctions have their own challenges, not all wholesalers may be reputable, but it's up to you to do your due diligence to find the good deals.

My first 3 deals were all purchased at the County courthouse steps at a foreclosure auction, and 2 of the 3 have worked out really well.  The first one fell through and I lost our earnest money. Good luck on which ever way you decide to go!

Howdy Joe, I'm retirement eligible from my W-2 job (active duty military) at the age of 44. I have 6 years left in my service commitment. Fun thread, thx!

Howdy @Tushar, and congrats on taking the first step on your REI journey! Good question about Private Money Lenders. I found that @Matt Faircloth's book (Raising Private Capital) gives a great overview of who can be a private money lender and where you can find them, as well as the broad-strokes process.

I've been doing PML deals for about a year now as the money provider. For me it's a great passive way to invest in real estate. For you as the deal provider, you can negotiate loan terms can be a great deal more flexible. You can try and negotiate almost every aspect of the deal. Some examples include:

• 0% down
• interest only payments with a final balloon payment
• deferred payment until your cash out refinance
• potentially fast (2 week) closing
• ...And more

These benefits come at the cost of paying a higher interest rate and typically a few points. Good luck on deals two, three... etc!

Depending on the type of investing you have planned, or the type of motivation/education desired, I recommend the following:

For help with overall motivations and mindset:

• "Beginners Guide to Real Estate Investing" (free eBook) by Brandon Turner
• Richest Man in Babylon by George Samuel Clayson
• Rich Dad Poor Dad by Robert Kiyosaki
• Getting Things Done: A Guide to Stress-free Productivity by Daivd Allen -- It's not a real estate book but it will help when it comes to getting and staying organized.
• The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich By Tim Ferris

For help with Property Management:

• Landlord-ing on Autopilot by Mike Butler

For help with Raising Funds:

• Raising Private Capital: Building your Real Estate Empire Using Other People's Money by Matt Faircloth

I have a tenant whose 6-month lease is expiring at the end of July 2020, and I offered the tenant their same rate for a 12-month extension.  Instead they opted for another 6 months at a 2.5% increase. At the end of this lease, then I'll offer the tenant the same deal over again: a 12-month extension at the current rate, or shorter terms at a graduated increased rates. Month to month term is a 10% increase and a 12-month term is available at the existing rate. 

@Matthew Tierney, I'm basically doing exactly what you described in your post.  It took time to find and build a relationship with a reliable Rehabber that needed money.  DM me and I can give you more specifics.

I've had my initial REI success through private money lending. I was drawn to this form of investing because it is the most passive form that still builds your experience with "working deals". I am using a self-directed IRA, so that all the profits are tax free.

@Mckenzy, Keep calling around. Smaller local banks and credit unions are more likely to work with you than the big ones, so keep trying. You won't get any equity out, until you do... And if this it were easy everyone would be doing it!  

I will also second what @Brian suggested and suggest shopping around for a HELOC. I know those are drying up too, and taking a long time to close, but they're not completely gone. As a data point, I'm closing on a 100% LTV HELOC from Tower Federal credit union on Monday.

Best of luck to you!

As a private money lender I care about 3 things: 1) not losing my money, 2) finding a deal provider that knows what to do with it, and 3) getting a fair rate of return. As part of building your relationship with your new friend, work on convincing him that his money will be safe with you, that you will make good use of it, and you offer a fair rate of return... if that's what HE wants. Typically, if the other person knows that you are looking out for their interests, then you are more likely to come to a mutually agreeable deal.

As a private money lender I care about 3 things: 1) not losing my money, 2) finding a deal provider that knows what to do with it, and 3) getting a fair rate of return. As part of building your relationship with your new friend, work on convincing him that his money will be safe with you, that you will make good use of it, and you offer a fair rate of return (if that's what he wants).