All Forum Posts by: Javier D.

@Mark Fries

I decided to do the 1” plastic ones. They survive more than 1 tenant. . Those 1/2” ones get wrecked every single f time lol.

@Marc Pelletier

Are these numbers correct?

Why is down payment 78k if its 20% of 260k?

Electrical 100 in florida? Why are you paying electrical? And if you are why so little amount?

90k in repairs right off the bat? Are the units habitable? Price point suggests c/d class property. Slap some lipstick/fix any deferred maintenande and go.

Can you do a repair loan?

260k 4 unit property bringing in 4400 should

Leave you plenty of cashflow.

@Marisa Rowe

100k a month.

Paid off assets.

No commercial loans to refi, no worries about

am i getting the best returns bla bla.

No worries on market fluctuations.

fully insured

Fully managed

Fully stocked ice coolers catching fish and not

Having to worry about my family’s future.

Maybe sell and get into triple net leases or something else that i can get really lazy with gain 30 lbs and have my wife call me her teddy bear instead of her stud.

Merry xmas to all here. Glad to be part of this community.

@Kellen Canfield Is your rebuild modern? If so its actually being used i wouldnt worry. Honestly i wouldnt worry anyways itll look nice. Voice what you wanted anyways maybe he’ll change it. Backsplash isnt expensive and so he knows what you prefer and expect for the next one.

@Bill Dengler Its common. The question is do your numbers work at the price they came back with. If not then risk it, walk away and maybe when they re-list or put it back on auction you try again. Sometimes banks are willing to do habitable/safety repairs so if there is anything like that reach out to listing agent and ask. Maybe you can recuperate some of the difference there but it is a long shot. Good luck

Originally posted by @Thomas S.:

@Kelly A.

"Why leverage 12 homes ?"

Simple answer. To grow your business, increase your cash flow and increase your CoC returns.

Why....because it is a smart business decision naturally. Keeping cash sitting dead in a property is not a business decision it is a emotionally driven personal decision. Nothing wrong with hoarding cash if that is what you want it just isn't smart business management if your goal is to grow your investments.

 I agree to a certain point. Its true leveraged properties give you a higher coc so on paper its def better as your profit compounds with appreciation and having more properties to achieve this. This is where real estate shines. Already having a pretty good portfolio of paid off properties her income seems to be pretty high. 

There is a variable though. What is your goal? Will 1000 dollars more a month help you achieve your income goal? Will 10,000? I always have my net income goal in mind. It helps me not be a gluton or make aggressive purchases. There is a risk factor. To leverage your portfolio this needs to be assessed. I did not want to risk what I was making off those paid off ones. Knowing i can live off that alone and survive any market fluctuations made my decision easier. Thomas is right though. It shouldnt be an emotional decision alone. Emotion is a part of it though in my eyes. Do i go to bed soundly? Will my kids eat if i break my back doing an inspection on a property? These are healthy concerns in my eyes and i do weigh them in my investment strategy. 

@Kelly Aldridge I had same exact issue. Same amount of free and clear properties so I know its frustrating at times to see that money stuck in bricks and mortars. i decided not to leverage the properties that brought me x amount of net income(those 12 exactly). what i did: i sold my worst performing property. well 3rd worst but in the worst neighborhood. I have a heloc on my primary that I utilize from time to time. I dont overdo it with it and pay it back pretty quickly. This had the best interest rates out of all the options i was offered. Your net worth having those will help if you decide to scale to multifamily in the future and honestly i rather manage 10-20 properties not leveraged than 100 that are. I hope to read what you decided so maybe You can confirm I did the right thing or find me a better option. :) Good luck!

@Russell Brazil Hi Russell, I just looked at the last 3 contracts and huds i bought from an reo agent directly. Two had listing agent under listing broker and also as cooperating broker making 2% on listing side and 2.5 and 3 on cooperating side. The other one had the reo brokers partner as cooperating broker. Maybe different banks/asset management companies have different rules as well as different operating practices in my state.

@Young S. Dont be too paranoid... Reo properties sometimes sell for less because the listing agent pushes their own buyers. I buy reo and short sales directly from listing agents for this reason. I know it sucks and it is sketchy on their part but it is what it is at least in my markets.

Originally posted by @Axel Ragnarsson:

@David Harriman @Marcus Johnson @Javier D.  

I appreciate your input and certainly see the risk of being highly leveraged and scaling quickly... I was not in the business in 2008 when the market crashed and realize that I've only been investing with the market at my back. I've asked many local investors I know how their portfolios were affected when prices dropped ten years ago and most say that rent prices did not fluctuate significantly but vacancy rates increased. The vacancy rate in my market right now is 4.5% and I underwrite at 9% (and actually put that money aside each month). In addition, I also actually put aside money each month for capex and maintenance/repairs. When I say my cash flow might be $50/door on a property, it's 50$/door after I've put aside nearly 40% (maintenance, capex, vacancy, and PM) of the gross rents into a separate checking account. Sure, I certainly have a significantly higher risk profile than many investors and many of the people using BP. I very may well have a tough couple of years if the market takes a steep dive - but I'm consciously preparing myself the for the scenario. Thank you for the thoughtful replies!

Awesome. You’re killing it. Just seeing you share your success with the intentions of helping others tells me you’ll accomplish great things brother. Good luck to you