All Forum Posts by: Dave Hurt

Thank you @Kevin Siedlecki I agree - far too shortsighted on his part.  Sure he may not have made as much money on the deal but he had already accepted my offer and promised to have the contract over 'immediately'.  In my opinion this shows a lack of integrity and had I been in his shoes I certainly would have honored the verbal acceptance...especially since I was already considering another deal of his.

Hi folks,

Thought I'd share an experience I just had...especially for newer wholesalers out there trying to get started. I found a FSBO on Craigslist that turned out to be a wholesaler. Reached out to him about the property and told him I could come to see it that day.

We set the meeting and I drop everything & come out with my GC to view the property.  It has a TON of potential.  We crunch the numbers and determine an acquisition of 120k will net a solid return on the rehab.  I offer 120k all cash with a 21 day close.  He tells me he needs more for the deal to work on his end.

I don't negotiate against myself so I ask what he needs to say yes and get the deal done.  He tells me $130k and the property is mine.  DONE. My initial offer was purposefully on the low side so I told him I would raise my offer to $130k and let's draw up the contract.

He said he just needed to 'check with his partners' really quick but there shouldn't be any problems.  24 hours and nothing back from him.  I reach out to him and he apologizes for the delay and that after discussing they accept my offer of $130k and he will send the contract over immediately.

Some more time passes and I inquire about the contract...I've also informed my lender, GC, and attorney that we should have the contract shortly...he says he'll have it right over & he is excited about the prospect of doing more deals with me in the future.  In fact he'd already sent me another property that I was going to go view for a rental.

THEN I get a text (not even a phone call) to the effect of "Sorry someone just reached out and they are paying more so we're going with them".

This was after he told me the number they needed and I offered full asking price, told me they accepted my offer, and that he would send the contract right over. Just to chase a quick buck on one deal, he threw away the potential to do a bunch of deals with me AND do you think I will ever recommend him to any of my fellow investors that attend my meetup?

Reputation is everything in this game and this gentleman is doing a great job of tarnishing his very quickly.  Situations like these are exactly how wholesalers get a bad rep.

@Chris Mason thanks for chiming in - I use LLC's for asset protection. In my situation it is primarily because I own several restaurant franchises and franchise rights for several territories, which I have to protect - so I hold each restaurant in an LLC and my real estate business in a separate LLC.

The last thing I want is a patron suing me for slipping in my restaurant and going after my rental portfolio and other personal assets...and the the converse - a tenant suing me and going after my restaurant businesses, so my attorney advised protecting all of my assets via entities.

It seem I may be doomed to less favorable refi terms but so be it if that means protecting my all of my various assets.

Hi @Emery Johnston the meetup is on Monday - hope you can make it!

Thank you @Upen Patel @Russell Brazil and @Alexander Ross. Lesson learned here - I suppose it wasn't enough to just tell the lender that I owned the property in my LLC - I should have done more digging into the guidelines myself. This was my first refi attempt on an investment property & I certainly won't make this mistake again!

@Russell Brazil I cannot believe my guy missed this then! Under the delayed financing exception, which allows a cash out in less than 6 months from taking title, you can take title under your LLC but quit claim into your personal name...if that is the case why are they now requiring a 6 month seasoning period while held in my personal name?

@Eric Le the commercial lenders I've met with were not interested in a refi on a single SFR but I may have to keep digging...

@Russell Brazil this is from the Fannie guidelines under the "Delayed Financing Exception":

• a natural person;
• an eligible inter vivos revocable trust, when the borrower is both the individual establishing the trust and the beneficiary of the trust;
• an eligible land trust when the borrower is the beneficiary of the land trust; or
• an LLC or partnership in which the borrower(s) have an individual or joint ownership of 100%.

@Russell Brazil before proceeding with this cash out refi I surveyed several lenders who all said it wouldn't be a problem because I acquired the property all cash - were they really all mistaken?  This particular lender has been in the business for a long time and was a referral from a fellow BP member.

Hi Charlotte Investors!

We'll be getting together again this upcoming Monday December 5th at 6:30pm for beverages and real estate talk.  

As always, I'll be hosting at The Brass Tap in South End.  The address is 1440 S. Tryon St.  All cans and bottles will be half off for attendees, as well as appetizers.

@Troy Knight will be there to talk about his awesome new build project that he just closed!  Right Troy??

Let me know if you plan on coming out!