All Forum Posts by: Seneca Hampton

A seasoned mentor of mine told me this:

"The further you move from the Coasts the more cashflow you can earn, the further you move toward the coasts the more equity one is able to build over time"

Hey James Wise great question! If Cory rents out the property, as he stated, the bank would count the gross rents as income for Cory. As this shows the bank that this is investment property is actually stable and generating income (which is why I say 6-12 months). Also if the home was purchased below value, getting it refied wouldn't only be easier (due to the monthly income) but he also wouldn't need any down payment because it's simply a refi. The HML gets his money back, the rents cover the loan, prop taxes, HOA (if any), insurance, and HOPEFULLY maintenance. Again, it's a risky strategy (there are assumptions that the numbers work) but it is an option and by no means an end all be all.

Troy Fisher as I said it's very risky. Cory must consider time vs money. Most HMLs in my area do not "require" 6 months of reserves And we are talking California... What I've found is that if you have contingencies in place, bought at the right place, it's a great property, the numbers are in their favor and all the stars align so to speak they feel much more at ease and even impressed. It's all in the presentation. But I completely understand your position. Cory also has the options of waiting and saving or learning to wholesale in the mean time to raise 6 months worth of capital plus 25-35% for the down payment. Both of which take time, nothing wrong w that just a different strategy.

Hey Cory Anderson ! I'd recommend looking for hard money lenders (HML) or private money lenders that do loans in those numbers (some don't loan on that small of an amount simply because the return isn't that great for them). If you found a HML you'd be able to only put down a few points (3-4 in your area I'd guess) put someone in the home for 6-12 months, THEN head to the bank and get the home refied. Not the cheapest in the long run way but a work around for those itching to start with low funds. Plus, WHEN you buy the property at the right price (if you purchase the property at market or above this isn't the best strategy) there is always the option of wholesaling or retailing it if your renting & refi strategy doesn't seem to be working. It's all risk but the key is to make precise calculated risk. Good luck Cory! Hope this helps.

"You Can Negotiate Anything" by Herb Cohen

"Flipping Properties" by Will Bronchick

"Think and Grow Rich" by Napoleon Hill

"80/20 Way" by Richard Roch

@Steve Babiak my question was not concerning the basics of a simple Real Estate agreement nor the process of how to go about coming to a meeting of the minds. The question was concerning the term "under contract" which implies a process. Having never heard the term I was attempting to gain clarity rather than assume. Better to ask a dumb question and look dumb now than find myself looking dumb in a real life situation.

@Bryan L. Thank you for clarifying I appreciate it!

I think I have had a case of not understanding the verbiage. So getting a property "under contract" = opening escrow... ? I.e. Me: "Hey Bob, I'll give you 100k for your house. What you do you say?" Bob: "Ok, I'll take it."

Now at that point are we signing a contract on the spot (is there a template for this)? Or is this something you'd have drawn up by an Attorney?

Correct me if I'm wrong but "getting a property under contract" is the exact same as the process one goes through with a broker but with a great price, right?

I've got a dumb question (Trying to learn the process)..... What does it mean to get a property under contract? What does it look like (step by step)? What do you need to do that? Is this something an Attorney would do or I could download?

@Christian Sanchez check out http://www.biggerpockets.com/real-estate-clubs/california.html

its how I found my club!

Hey @Brandon Gillespie

@Jay Willems is right, depends on the type of investments you're interested in. Like, Jay I've only been on for short while but I'd say it might be a good idea to try and find a mentor. They'll be able to help you avoid a lot of pitfalls. Second, create a plan including your investment criteria first: types of homes, % of return on deals, property types, etc. That way you are not chasing everything that looks like it could be a good deal. Also, during this process it may be a good idea to start to build your team: CPA, Mortgage broker, RE Agent, Contractor, etc. These are the people that will make your deals run SO MUCH smoother. It's your choice on whether or not you want a mentor but they could be an excellent resource to help helping build a solid foundation. Like Jay said, keep there is a lot of great info and wonderful people on this site. As long as you are motivated and do your due diligence you'll be just fine. To help you get started check out the link below:

http://www.biggerpockets.com/real-estate-investing/introduction

Good luck!!