All Forum Posts by: Erik Hitzelberger

@Tom Scott I always use a Property Repair Estimate Checklist for the initial walk through.  My goal is to be in and out in 15 minutes with a number that is good enough I can make an offer.  I HATE wasting time and nothing is a worse use of your time than spending hours (at the house or in your office) on a property you may not even buy.  Not only does the PREC help you get in and get out, it also makes sure you do not overlook anything.  

Adding a second faucet is... what's the word... oh yeah... LUDICROUS!  :)  Lowe's sells a 2-outlet timer for $35.  http://www.lowes.com/pd_163729-74985-27133_0__?pro... There is also a 4 outlet one for $50.  

I'm a little confused as to whether you are buying a primary residence or an investment property.  Your primary residence is the place you and your wife will live, entertain friends, make memories and possibly babies :).  If it is in the perfect place, has everything you want, and you are both ready to own a house and willing to do the work this one requires, then go for it.  While you never want to be upside-down, the numbers are less critical.

If this is an investment property you intend to flip, make sure you account for the carrying and closing costs (both purchase and sale) in your analysis.  If the deal make sense, go for it.  If you are unsure, post all of the numbers here and BP members will help you analyze it.

Either way, you have an inspection contingency.  Use it to satisfy yourself the foundation is good and the rats didn't chew through all of the electric, and whatever else you need to have checked out to feel comfortable.  If there is a valid concern, don't buy.  Fear caused by lack of knowledge is not a valid reason.  But, you know that or you wouldn't have posted this.

One final note, check with your lender about the 203K requirements.  I think you have to have contractors do the work.  You'll want to understand that piece as it will affect your cash requirements. 

@Adam Shelley Welcome to BP!  The Shark Tank KREIA meeting was actually really good.  Investors presented deals and the 'sharks' (experienced investors) analyzed them and told people what to look out for it.  There was so much positive feedback that the board is going to bring it back in an upcoming meeting.

Next month's meeting is in 2 weeks.  Let me know if you are coming and I'll make sure there is a guest pass for you.  It's either $10 or $15 off.  The main meeting will be a national speaker.  So, there will be a pitch at the end, but the content will be good.  Besides, the real meeting always takes place afterwards.  This is where you can network and ask questions with everyone else. 

As far as New Albany, make sure you understand IN laws regarding investors.  They are less than friendly in some regards.  That being said, KREIA has a contingency of IN investors who meet monthly(?) for lunch(?).  Again, If you are interested let me know and I'll track down someone who can tell you for sure.

@Damon Armstrong - Have you ever watched or played Texas Hold'em?  It's an interesting game to study.  The pros know that the cards of are little importance.  Identifying tells, understanding statistics, representing strength or weakness, considering your position/table image and maintaining discipline are all more important.  Sure, you may have short-term set backs, but over the long-run the best player takes all of money from the player who only thinks about the cards.

In a similar fashion, being a successful real estate investor has little to do with real estate.  You are a business owner.  You must be able to communicate with buyers, sellers, contractors, lenders, employees, and a host of others.  You have to market to sellers or buyers or both.  You have to analyze opportunities and understand the financial implications (including the opportunity costs) of proceeding.  You need to understand the financial markets and how they affect your goals.  I could go on and on....

It is far better to learn how to do these things in college than by making mistakes in your business.  It is also far cheaper.  You are incredibly fortunate that you know how you want to apply the knowledge you gain.  Approach learning with the zeal that you show for real estate.  Absorb everything.  As you build your business, the knowledge and discipline you gain from college will allow you to accelerate your growth at a pace that is otherwise impossible to replicate.

Three final points.  First, don't rush through the experience.  Being 18-22 and in college can and should be an awesome experience.  Don't lose focus on the future, but enjoy the heck out of the present.  Second, there is nothing that says you can't get started investing why you are in school.  Buying a rental house that you also live in is a great way to do so.  Paraphrasing Kiyosaki...Most people say 'I can't'; investors ask 'How do I?'  Third, like poker, the game never ends.  A constant pursuit of knowledge is what will keep you ahead of the competition.    

As mentioned above, it happens.  You have 2 options at this point... 1) Laugh about it, remove her from your mailing list and move on thankful that you aren't a miserable old woman or 2) Follow-up with another letter stating that the offer doesn't have to be all cash, you would allow her to owner-finance the sale :)

I disagree with Andy's general statement that lease options require you to pay market rent + an option fee.  There are plenty of reasons a seller will let you take a property off of their hands for a monthly fee that is well under the amount of rents you can collect if the building was performing to its potential.  

I prefer to buy via owner financing/subject-to/etc and sell via a lease and option, but buying via a lease and option is not a bad choice especially if you aren't terribly familiar with the market.  

If you have good credit and good W2 income and enough money for a down payment (5-25%), your chances are really high. It should take about 15 minutes to call a lender and verify this. Without knowing any more, it sounds like you can get a loan from any bank, but I like working with small local banks for REI.

@Myles Wisdom Happy Friday to you as well.  I also like Google Apps, online banking, etc.  That being said, nothing increases the efficiency of your business like great systems!  Eliminating confusion, non-value added activities, and senseless mistakes will save you waaaaaaaaaaaaaay more money than any app.

In my area, we have to note all of the damage on the Move Out Inspection form and have the seller sign it in order to retain any portion of the deposit.  That being said, the number you should use is the amount it would cost you to return the property to the same condition it was in prior to the tenants moving in (adjusting for normal wear and tear).