All Forum Posts by: James A.

@Lisa M. I would highly recommend using a consultant.  The guy i used was great he came out looked at the property and told me ahead of time if the property would be eligible and the things that I would probably have to keep.  They do CHAP all day and know it in and out.  Paid $1200 and they took care of all the filing and made sure we kept our renovation with in the scope as not to disqualify the house for the credit.  

@Account Closed  am curious what type of contractors you are talking with.  I am not saying you are wrong, I have been told $50 sqft for gut and rehab as long as your not doing anything crazy like bump out or addition.  I spoke with a couple guys who do a lot of fixing and flipping and they said they average between about 70-75K total for their rehabs, that is a full rehab.  I still struggle bc you can get some varying numbers so I guess the best advice is get multi bids.

@Shawn Moser Partner.  Best of both world you get to put your money to work on an actual deal and you have someone else who is just as vested as your are in your project.  You get to learn and should make a little money while your at it.  I am focused on fixing and flipping and have learned soo much from just going through the process from start to finish.  Trust me when i say real estate is about living it, because no amount of knowledge is going to prepare you for the things that will come with investing.  Example when you have to spend a Sat. cleaning out the neighbors basement from a ton of dust that was created when we demo our rowhouse and giving them a bottle of wine as an apology.  Start networking and you find out the people who are doing deals and are willing to help.  Good Luck!

@Matt Radhe I have only been investing for a year but have lived in Baltimore for about 9 years, so I am very familiar with the most of the different areas.  I am focusing on just flipping, fix n flipping as I have learned that you can get distracted by all the different strategies and end up spinning your wheels.  I think you are doing the right thing by studying the neighborhoods and identifying houses that might stand out.  I know people are saying there are no good deals on mls but i don't necessary believe that.  I have been finding that deals are still on mls you just have to pull the trigger much faster and that can be hard when you are newer investor.  Another thing i have learned I would always question something that had not been picked up by an investor and there must have been something really wrong but in reality most investors only have limited amount of money and time.  You have to analysis the deal to your criteria and make sure the numbers work for you investment goals.  I have talked to several different investors about how they decide what return they look for and some do it by a dollar amount and some are looking for a certain percentage.  The point is that you have to spend some time to figure out what you want from you investing.  A great way to learn different areas is attending open houses.  I focus on ones that have been fixed and flipped, seeing what other investors haven done on there reno and get a chance to talk with realtors who work with investors and pick their brains about the market and different neighborhoods.  Get out there start being active!  Hope to see you around.

@Matt Radhe Welcome to BP! Just another suggestion, if  you don't have enough funds focus on finding a great deal and partnering with someone who has the means.  Deals are getting tight in this market and having a good deal could set you up to be in a favorable position to partner or you could wholesale for some quick cash and that could get you to doing your own deal.  Good Luck!  

@Kendra Rodwell Congrats on deciding to take the leap!! I was in your shoes not so long ago and seems like you are getting all kinds of great advise. When i made the decision to buy my first deal I did the same as you. I spoke with some HML, I even got prequl by a couple. I also go introduced to Private money lender who was doing 9% and 1% origination and even would defer payments till the end of the deal. I think it is important to have multi lender contacts because as the private money guy explained he might not have the funds when i bring a deal to him so you would have to take it to another PM or HML. Every person i talked with I made sure they understood that i was new and it did not seem to be a problem. The next step is finding the deal. So here is some food for thought. Most HML and PML are putting up their own personal money so it isn't like a bank were they have underwriting guidelines and if it hits all the boxes they do the deal. I took a deal in upper fells to my PML and he turned it down bc he was not a big fan of the city. I presented it to a HML who i had qualified with and he liked the deal alot. So just remember good to have a few different sources in your pocket.

You mentioned your strategy is fix n flip which is great that you are picking a strategy and attacking it. I started out with the intention of partnering. I went to meet ups, even signed up for the Baltimore REIA which does cost money but I was serious about doing real estate so I signed up, but there are plenty of free resources. I always mention to people if they are focusing on fix n flip, Rehabber Pro! Can't say enough good things about them and one of the guys who runs it is a contractor so I am always picking his brain. So my decision to partner came from listening to Brandon say part of something is better than all of nothing. I figured if i could partner I would learn how the whole process works, nuts to bolts, and hopefully the correct way to do it and yes I would be giving up some of my profit but I figured I would probably lose that much in making mistakes just trying to figure it out on my own. So I think you have to make your decision but I dont believe either is necessary better. No matter what you decide to do, make sure you are connecting with more experienced people bc I have never heard of a flip going as planned so you wanna make sure you have people you can call or just bounce ideas off of. I hope to see you posting about your flip soon.

@Jasmin Harrison Welcome!  Jay Scott actually lives in MD.  He does a lot of guest speaking at the investor meetings around the area.  I really like Rehabber Pro.  If you are interested in fix n flipping the guys that run the group are great.  They usually have case studies of actually renovation projects and they usually try have the meetings at an actually project.  Hope to see you at the local meetings.

@Angela Meraklis-Lyons I think if it is true partnership where your partner is just putting up the money and taking care of all the money and they are leaving all the work up to you.  Then 50/50 split is pretty common.  I have talked with a private money guy who has agreed to do a 50/50 split but he does not wan to do any of the work or deal with any of the details or headaches.  I am doing a fix n flip with a another partner now.  We are doing a 40/60 split, I found the deal, I am taking care of the monthly expenses.  They brought the contractor, the line of credit we used to finance the property and they had more experience.  Good Luck!!

@Ken Nyczaj Happy New Year!! Hope your new investing year is going well. I will give you what I personally think and obviously I think each person has to consider what is best for them. You say the LOC you would have to put up your personal residence as collateral and for me because this business could got sideways on a dime I don't think I would be willing to do that. I am always thinking worst case and if it all went up in flames do you really want your own personal residence on the hook. I personally think you shouldn't be investing in something you are not willing to put some skin into and the fixed 5.5% is as cheap of money as your gonna get and if you put 20% down and it all goes south well you lost your 20% that is reasonable. I have a local lender who gives master line of credit but basically conventional loan that I can using for fix n flips. They did all the financial checks and got approved for a good amount but I don't have to put up any personal collateral. I think your conventional has great terms and they seem like they are willing to work with you guys so why go with someone who has a floating interest rate, we all know rate hikes are happening this year, and they are gonna make you put your house up. Hope some of my perspective helped. Hope to see you posting about your deal!

@Nilton Santos Happy New Year!  Great to hear are taking the dive into real estate.  I think some of the previous advise is great!  I would just add that maybe going to some local investment meets and speak with others in your area to figure out if some your surrounding areas might work for investing.  I am investing out of Baltimore and focusing on fix N flip so I can't speak to much to rentals but I know Baltimore you do have to be careful because each area is different.  Another thing to consider is that Cleveland and Baltimore are not too far from New York.  You might consider connecting with some people on BP and taking a road trip to check out each market.  I think it def can be done I just think it takes more due diligence. Good Luck!!!  Happy investing!