All Forum Posts by: Jason S.

There's a lot of money in the guru biz. You can do both you know, be the guru and actually do deals.

I remember reading one guru's letter to the head of a REI Club - the letter said, give me an hour in front of your group and you will make $100,000 within the next two weeks from the products sold. He had a whole tracking system and everything.

Come to think of it, this means there is a lot of money in the REI Association Biz too - take that to heart. You can teach, you can do, or you can organize - or maybe do all 3 - your choice.

Congrats on this - these guys can be ruthless and sometimes only buy super bargains, but still, you now are connected with no doubt multiple millions in cash should you come across a super sweet deal.

Not the first group to sell to (they are far from retail buyers) but it all depends on which ones you have met - I know in my area some of the courthouse steps guys are willing to operate on lower margins than other traditional investors because they are working on volume.

Look I am not pitching it, I am just saying that was what he was doing. I think in the end you needed a couple thousand in reserves, but I really believe I remember it was $500 cash in. I just checked his last email to me about it - the final LTV was 75% and gave $200-$400 cash flow - not 50% rule cash flow but what do you want for $500. Anyhow his email said he did around 70 in the last few years.

When I was looking into Memphis it was because there were some deals I had seen very cheap, I called his guy and he explained the neighborhoods, the zip codes, everything else, and in the end, even though his guy would have made money with re-hab and mgmt, he told me not to buy.

I just found it interesting - there are a lot of turnkey guys in Memphis (many here on BP) - though I do not know if they have the $500 deal.

I think some of the companies fly in investors, drive them around in buses, and sell them deals - similar to the Bus Tours from China buying props in SoCal.

There was a time I was investigating Memphis and found it was a very unique place. Turns out I have a friend in CA who has had a lot of success out there. He has even had several friends invest out there hok up with his contact with a mere $500 - with $500 they buy a home with HML, they re-hab the home, they then re-fi it at some LTV I do not know, and then rent it out and manage it - all turnkey. He and his friends own many of these for years so something must be good. Pretty wild really, I have never seen another place in the country like Memphis. All Turnkey. So you are right - What Is Up With Memphis.

Whenever I see people from Memphis I shake my head, I could not believe what an interesting place it is. Does anyone know a place that is similar?

That's what I was asking - if your quoted 15%-20% was your cash on cash return ( I called it cash invested) or Cap Rate (which I called the return on the asset). I will have to get my terminology straight.

Thanks Jon & Will for earlier answers.

As you know I am diligently working at my strategy with keeping income properties - Is that return on asset or return on cash invested? For you not the apt scenario - I was able to reverse out and match your calculation for that.

I still think it is probably quicker to save money and do a deal with an experienced partner where you bring a little money to the table than it is to try and learn everything you need to know and then try to find a deal and make money on it.

1. Find someone that will teach you by doing, as in, you do the following crazy amount of grunt work, and I will work with you on a deal found.

2. Get a second job, save money, find an experienced partner that is doing deals and needs cash to capture the next one, partner and learn.

3. Study wholesaling, pricing, values, everything else involved without a local hands on partner and try to eventually find an elusive deal and toss it to someone who you can flip it to and they will make the offer fast enough to capture the deal because you do not even have EM.

I am not certain which is easier. I started at #1.

I would never take a house with a septic where I cannot confirm that it is going to be acceptable to the local authorities. There are some local areas where I am a septic expert and I know everyone at the Health Dept, but save for those rare exceptions, I would not do it, and I would not advise you to either.

But where I am at Septic's have been a huge issue and I have seen many homes/lots marked uninhabitable due to this specific issue - I am not certain how severe and "hot" the septic issue is in your area. But surely if you are not an expert at it, I would steer clear.

Second thought - I cannot recall the last time I ever entered into a contract with a non refundable deposit and zero inspection period - that right there is a red flag to me.

Come on Greg, let's not give up all the info and create too much competition. You may have that large nest egg but mine is limited and I am competing out here.

The fact is though, most deals seem to close the first time out the gate - the top agent will give you there pipeline ahead of time and you can have all your research done before anyone else even knows it exists. Even if the bank insists it hit the MLS, which most do, your offer is in the day before.

Thanks. Though I suppose the retirement account could act as the lender on many of the deals or is that prohibited because the borrower would be a disqualified individual?

I have been reviewing many apartment building spreadsheets etc, is their an equivalent quick analysis algorithm such as the 50% rule for those?

What about for buying discounted performing paper with an effective high yield, seems that would be the easiest way to cash flow, assuming the paper was underwritten properly.