All Forum Posts by: Jason Pachomski

Disclaimer: I'm still pretty new to all this...

So, I've been reading up on HUD and how the properties that it sells work for investors. I had a thought that seems pretty simple (which makes me immediately think that I'm missing something).

A hypothetical scenario: Let's say I find a SFR on the homestore site that I want to make an offer on. I do my math and figure my offer price based on ARV and an intentionally inflated repair estimate (seeing as I haven't seen the inside in person). Now, let's also say that I have almost none of my own money to use -- I could pay the $1000 earnest money deposit out of pocket though.

So if my offer gets accepted is there anything wrong with taking out a hard money loan for the purchase price and repairs, then retailing the house once the rehab is done? I mean, it's all about the numbers right?

If I could find a deal that was discounted enough for me to be able to afford the 14% plus 6 points the lender will charge me, plus cost to sell, and still walk away with a profit, is there anything wrong with that? Are there factors I'm not considering? The way I see it, the biggest hurdle -- and maybe an insurmountable one -- is going to be finding a deal that's discounted enough for the numbers to work.

What do you think?

Thanks in advance!

(PS. I've also been considering the same scenario I described above, except instead of HUD I'd be buying from wholesalers.

@Shaun Caldwell good point! I'm about to send out "Follow-Up Letter #1" of the campaign I'm running. First mailing generate two leads and a handful of angry responses. Of those two leads, one wanted a ridiculous amount of money for their house, and the other (an absentee owner from Jersey) wanted to sell and then was a complete d**k about it over the phone so I just dropped him haha.

Also, if anyone is looking to farm out their yellow letters, I use @Jerry Puckett 's service and it's so far been great. He gave me his spreadsheet to track the mailings and some scripts for inbound calls. Very user/newbie friendly

(I'm not affiliated w/ Jerry, just a satisfied customer)

@Shaun Caldwell That's a pretty interesting take on the yellow letter! Is this something that you try to pass off as being actually handwritten, or are you not too concerned about that? (not asking in a snarky way...legitimately curious). I've heard so many opinions during my short time in this game on what a yellow letter should say or not say or look like. Always good to see options and hear how they're working out. 

@Brian Huber Are these probate leads? If so, I just address my letters to whoever is listed as the PR. If there's two people, I address it to both (e.g. "Dear John and Judy"). IMHO a more personal greeting warrants a more warmer reception.

Of course, if you're not talking about probate leads then ignore everything I just said haha

Hey @Joe Tinnerello I'm by no means a marketing expert (yet) but have you explored any of the traditional means of marketing to motivated sellers (yellow letters, bandit signs, postcards, door knocking)? I don't know anything about your area, but you could also drive around and look for vacant houses then track down the owner and see if they're willing to sell.

I might be stating the obvious with all this, but figured I'd put it out there.

@Mike Mitchell I feel your pain. I'm in Los Angeles and I'm currently running a yellow letter campaign as well as mailing to a weekly list of probates. I'm getting MAYBE 3 or 4 calls a week and they've all either been people telling me they don't want to sell or they have some ridiculous number in their head when it comes to how much their house is worth. My particular corner of LA is literally SATURATED with bandit signs so I haven't even bothered with them. Maybe I'm shooting myself in the foot a bit on that but until I figure out a way to stand out from the crowd I'd rather focus my money and efforts elsewhere.

I guess none of that really answers your question haha. Just wanted to let you know that you're not alone by any means. 

Hey @Ariel G. I live in the valley and I know that what you're talking about is happening up here. I can't speak to whether it's done on the up and up or not, but I know condos especially are being rented out in this manner.

Hey @Mark Perrill 

Personally -- and I am by no means an expert -- I would just send them one of my normal yellow letters. I do know that people tend to get freaked out if they know that you know that they're behind on their taxes, even though the information is public record. 

If you don't get a response, I've heard of people putting together packets of info for people who are facing foreclosure and leaving that packet on their doorstep with your contact info.

Got this lead from my website the other day. Thought I'd share

I BLEEPED out the curse words 

Wonder if I should follow up with him in a month or so? :-D

User Name: Monkey F**ker

Message: Jason you F**king Bottom-feeder. Go parasitize someone else with your bullsh*t letters and computer-printed fancy-fonts.