All Forum Posts by: James C.

James, 

Straight property management would work. You just take a bigger fee.

Does he want to sell,  but doesn't want the hassle?  Then do a master lease with option to purchase. If no sale,  then just the master lease. 

How about a straight up purchase? Or maybe he sells it to you,  and holds the note for more passive income. 

Basically, need to figure out why he's not doing anything with the property, then solve his problem. You make money by solving the other person's problem.

As far as not mortgaging the property,  why not if it gets you more money? It's a bit of work and risk,  but if you stand to make more for yourself and your family,  while solving the BF's issue that's a real win - win in my book.

Hope that helps. 

Good luck, 

Jim 

Aja,

Some options:

Hard Money Lender. What's the ARV? CLTV? CARLTV?

Private Lender. (If your MIL is in RE, she probably knows a couple of them)

Make it a JV with your MIL. You all apply for a mortgage, you are all on the mortgage and then you take her out in a year or so. You could all HELOC it as well. A credit union or small local bank would be best for this.

HELOC the Gary property to fund the repairs to both.

Have your MIL loan you the money with a note against the property that she can sell. Or you create a note and sell it?  Watch the discount on a newly originated private note. 

Just a couple of suggestions for you to explore. 

Hope that helps. 

Good luck, 

Jim 

Douglas, 

You could see if a real estate closing company or escrow agent in Florida could handle that. It might cost a few bucks, but you could split that with the buyer. 

Another option,  probably more expensive, would be an attorney. 

The upside to both of these options is a clean transfer, and reduced liability for everyone. 

Sometimes it's worth spending a buck to give everyone piece of  mind. 

Hope that helps. 

Good luck, 

Jim 

Marvin, 

Yes. But why?

If you have some really great reason,  like, say you work overseas,  get free housing, and want to invest in a house that you rent out until you finish up overseas or work in an unstable location and need a place to go if the SHTF, then this makes sense. 

I also suppose that if you have a really cheap cost of housing, or some other arrangements (like taking care of a parent in their house for free living),  then it could make sense.

I'd be interested in knowing more of your thinking on this. 

Hope that helps. 

Good luck, 

Jim 

Yurly,

Welcome to REI. If you don't have jitters on your first deal, you are probably doing something wrong. Actually I think part of the reason folks do REI is for the rush of putting a deal together.

It's always difficult when you are doing something your peers and friends aren't. This is where a mentor comes in handy. 

IMHO the best thing you can do is just go over the numbers,  your plan, and your why again.  Keep those things in front of you,  keep checking for things you might miss and follow through.  

Your first deal won't be perfect,  but it gives you a baseline to start,  once you have your baseline,  then you can adjust as necessary from there. 

Hope that helps. 

Good luck, 

Jim 

Logan, 

I'll take a stab at this. 

NPV is the current value of all future cashflows discounted to the WACC ( weighted average cost of capital,  or the interest rate that you borrow at). NPV gives you a dollar figure that represents the increase  (or decrease ) in cashflow for the term of the investment. 

IRR is the percentage expression if that cashflow. It's done by setting the NPV to zero and solving for the WACC.

If the IRR exceeds the WACC, accept the project as NPV > 0, i.e. positive cashflow. If the NPV > 0 i.e. (NPV - acquisition cost) is positive, then the project should be accepted.

Hope that helps. 

Good luck, 

Jim 

Timothy, 

I did a search and came up with this :

http://www.bankruptcylawnetwork.com/massachusetts-...

I'd do a bit more research,  but this looks like a good starting point. 

Hope that helps. 

Good luck, 

Jim 

Metta,

I'm not going to pretend I know what you are going through. I too am appalled at the increasing inability to get a second chance in the USA, a country founded,  developed and built on second chances. 

My suggestion is to stop looking for a "real" job and start creating your own.  You've got a BBA, so put it to use. Start online blogging,  start creating your own business.  Buy a business with owner financing.  Master lease a property.  Do property management.  See if you can get licensed as a real estate agent from your state. Some of this won't work. Some of it will. 

Also, I would keep the fact that you are a ex-felon out of the discussion unless it's necessary. I can imagine it's a huge part of your life. I'm going to say that was a part of your former life. To move forward, to become the person you want to become for yourself and your wife, you have to find a way to cleave that identity/label from your being.

This will be your biggest challenge. When you accomplish this, Real Estate will be child's play. If you want to be successful change your mind set about who and what you are/were. 

In case it's not clear from my post,  I admire your honesty,  directness and self reflection. I think you can be successful, and accomplish your goals. My opinion is a revision of mindset might be the best place to start. 

Hope that helps.

Good luck, 

Jim 

China,

IMHO, you are putting the cart before the horse. Your BK discharge is the opportunity to get on the right path to financial independence. If you are trying to make money doing something you don't know about (Tax Liens) you will fail. That will put you in an even worse situation than you are in now.

First things first. Get your financial house in order. I would suggest reading "Set for Life" By Scott Trench, and "Rich Dad, Poor Dad" by Robert T. Kiyosaki, plus a bunch of other books. If you have kids, your obligation is to make sure that you have at least 6 months (or more) of expenses in the bank that you don't touch. This advice applies to EVERYONE!

8K liquid is probably not enough to meet the 6 month test, I would guess it's 2-3 months of expenses. Probably 15-20K is better. Ideally, if you are thinking of being an agent full time, then 12 months is better.

While you are working on that, you can begin to look at investing. I would be looking at 4 family properties to buy, and either stay in your existing house, or rent it and move into the 4 family and renovate. Learn how to do this by educating yourself, here on BiggerPockets, and with books. Most of the books that will teach you how to do this are free online (b-ok.org, openlibrary.org and others). I have found most of the books suggested in lists online as PDF's or you can borrow from your local library as ebooks online (ask them how to do this).

One more thing, (stepping onto soapbox):

You don't say how old your kids are, but put them to work helping you if they are old enough. Maybe they can wash dishes, vacuum, or clean the house. If they are old enough, have them help you in the real estate end. Children should be low-cost, tax deduct-able labor. Putting (teaching ) them to work (age appropriate, time appropriate), teaching them to be financially responsible, and teaching them to be independent of you are three of the most important things you can do as a parent. These are things they won't get taught in school, ever.

FWIW, you have a choice: Fight the battles now on helping/working/independence/decision making etc. or they will mooch off of you for the rest of your life. Hold their feet to the fire. It's easiest when they are young, harder when they are older. They will hate you until they turn 30, but the parent job description doesn't include "Friend to offspring" and "offspring must like parent at all times". In my line of work as a teacher, I see this all the time. Kids running parents, when it should be the other way 'round. 'Bout time we changed that order. Yes, I agree it's hard, it sucks, it's hearbreaking to have your offspring "hating" you for being a parent. What is more heartbreaking is the masses of people who don't have a future because nobody taught them how to be responsible as adults. Don't let your kids join those ranks. (stepping down off soapbox)

So, to recap:

1) Find some work that brings you a repeatable, consistent salary. Starting in RE full time is a tough way to do that. I would try to get a full time job, and then side hustle in real estate (put kids to work in side hustle).

2) Save 50% of that salary, until you have 6-12 months of reserves in the bank. Don't take on any more debt until you have this.

3) While you are working on #1 & #2, read, learn, educate yourself (finance and real estate), involve your kids, and create a plan.

Once you have 1 & 2 & 3 completed (this should ideally take less than a year), you will now have the following:

1) A chunk of change in the bank (say 24K+),

2) Education on how to be financially responsible,

3) Education (knowledge) on what type of real estate you want to invest in,

4) The ability to sleep at night knowing you can pay your bills if the SHTF.

and most importantly:

5) A plan. (that you seriously lack now)

Probably not what you wanted to hear, but I think most necessary to say.

Hope this helps!

Good Luck,

Jim

Answered in other forum (Posted in Tax Liens, Notes, Paper, & Cash Flows Discussion)