All Forum Posts by: James Dainard

Hey Greg,

If you have the opportunity to walk the property make sure that you take photos of everything.

If you show up and it looks like you can take on the project, then you have all the photos to show your contractors what you want to do. If you get there and you realize that it isn't the project for you, you can use the photos to wholesale the deal to the next investor.

You could arbitrage it too if the numbers work. By finding out what the property requires in reno you can take that number to the seller and work a deal with them to split/share the costs. You can act almost as a property manager (check licensing requirements) and collect relatively passive income for having your teams maintain the property.

Best of luck!

Hey Jesus,

If you're interested in jumpstarting your investments you might see if your state has any down payment assistance programs available for first time buyers. There should be at least a couple options for you, check with a lender in your area to see.

If that doesn't work out and you want to use the HELOC from your parents you'll want to make sure you underwrite with the cashflow necessary to pay both notes. Do you know how much of that HELOC they'd be willing to lend you? Do you know the rate and monthly payment for the amount that you'd want to borrow?

Find out what you qualify for on your own first then start playing with what you can borrow in addition.

Sounds like you're doing all the right things, keep going!!

Hey Andrew,

What's your general investing strategy?

If you're looking for a true BRRRR you're going to want to look a little further out just so your capital investment goes a bit further. Would love to help you figure out how to mobilize that equity. DM me with any questions!

Hey Joshua!

As a flipper you make your money on the purchase. If you know that you have the room that you need to crush a deal, that's the deal you should do.

While not all flippers are wholesalers and vice versa, there is a lot of overlap amongst those that do this full-time because the two are so synergistic.

Wholesaling isn't as complicated as people make it out to seem. You just need to make sure you have other buyers who will buy deals similar to the deals you're looking for. If you find one that doesn't quite work for you that might work for one of your friends, that's where you want to wholesale the deal and collect a finders fee that makes sense for both parties.

Building out this system takes a bit of time and some investment into relationships or lists. With that said it's well worth it for the types of deals you'll come across and the volume of deals you get to review.

Hope that helps!

Quote from @Kelley Ogletree:

My position can't be unique... I have a 6-figure W2 income but really will never be able to retire on it. As a single mom, I made every financial choice based on my kids needs at the time. We have a great life and I raised fantastic humans, but I never planned for my own future. So, here I am at 50 years old with adult kids and no retirement. I would LOVE to be able to leave my 9-to-5 in the next three to five years. My dream is to have STRs for cash flow to support myself and for personal use, but I don't know if I should start with that or maybe BRRRR a house or two (or more if I love it) to generate funds to get into the STR game. There are so many different ways to get started in RE investing and I don't have time to make the wrong decision out of the gate. I'm hoping someone on this forum will be able to help me narrow it down. Here's the down and dirty of my current situation:

$100k+ annual W-2 income, but a maximum of $750/month available to invest

$30,000 in the bank

$140,000 equity in primary home (selling my house is not a step I am willing to take)

Below average, but not horrible credit score (my son wants to do this with me and he has a good credit score, but not much in savings)

BRING ON THE ADVICE! Thanks!

 Hey Kelley,

If your end goal is cashflow you're going to want your mid-term goal to be finding ways to leverage up to get that cashflow. Your and your son's owner-occupied loans are going to be the best ways to maximize your leverage. That being said this option comes with higher monthly payments and some form of mortgage insurance which takes away from your bottom line. The sweet spot is to go 5-10% down on a conventional loan to be able to get PMI removed once you hit 20%. The goal being to get to 20% by prepaying to get the monthly payment down. This is a great option for people with low liquidity.

Since you have access to equity you could consider pulling that out with a HELOC to put as a down payment on something as an investment property.

You can consider investing with your son in a house-hack if he's willing to manage it and split the cash flow. You could also consider putting 20% down on something that you intend to STR.

Regardless if which way you go your goal should be to maximize the cashflow of the property and minimize the impact it will have on your DTI so that you can go on to the next deal sooner.

You could also consider doing a BRRRR using hard money to leverage up through the renovation. Refi it once you've got a tenant in place to pull your cash out to go on to the next deal. You'll want to make sure you have backup subs for each trade to make sure that your project goes smoothly. Time is money right now.

Hope all that help give you some direction.

Best of luck!

Quote from @Chris Bergeron:

Good Morning! 

I have a quick questions and wanted to see if anyone has encountered this before. I have a Section 8 tenant who moved into one of my properties about 4 months ago. She has been an amazing tenant and I really enjoy working with her. She has been complaining about the area, and finally told me today that she wants to move out of the home because she is afraid of the area, and walking her daughters to the bus stop there are kids with guns, and there are shootings in the area every so often (this is a poverty stricken area, so I understand her concerns)

She wants to break her lease and move out early (she signed a year lease and also gave me a $1,100 deposit) Should I require her to wait until we find a new tenant? Give me 30 days notice and then vacate? Return her deposit? Etc. Any advice on this matter would be greatly helpful! Thanks

Hey Chris,
Stick to your lease. If she wants to break and give up her deposit then she can leave at any time.
If she wants her deposit back and you're willing to give it to her you should do so after you've found someone to occupy the unit.
Your current tenant can leave immediately and continue to pay rent until you find someone or just give up the deposit or she can stay while you're looking for someone else. Just make sure she understands that you're working with her and she'll work with you on getting new tenants through the property.
Highly recommend that you ask her to leave for any property showings if she doesn't like the location.
Best of luck!

Quote from @Tyler Solomon:

I am curious about short term rental syndication - seems like a no brainer to me. Has anyone on here tried this before? Do you know anyone who has?
If so, please share what you have learned / heard.

Thanks!

 Hey Tyler,

It sounds like a good idea if you can find the right property and demand for the STR market. The difficult part of this would be the SEC approval like others have mentioned (if you're going to be syndicating with non-accredited investors) but also you're going to have to find the investors who are willing to take variable returns. Alternatively, you're going to have to find a way to average or standardize how you get the returns from the property to the investors.

If you end up getting private capital lined up without SEC approval then you're better off just paying them off to keep the property in your name.

Quote from @Maria W.:

Hi, new investor here. Like many new investors, the current housing market has made it really difficult for me to know what is a good purchase because I don’t have a lot of tools on my belt to make something work.

I currently live in Navarre, FL which is a beach town 30mins west of Destin, FL. My current house is close to the beach and I have AirBnb’d it when I’m out of town.

I have a 3/1 condo in Springfield, VA (just right outside DC) that I have completely paid off and its current value is ~$315K. It cash flows $2k/month. I'm currently working with a realtor from Bigger Pockets to explore my best options for selling it either now with a tenant in place or in the spring ~April 30th.

My long-term goal is to replace my current W2 income with investments so I can stop working. In this ever-changing market, what are the best strategies for me to consider in reinvesting the money from my condo sale so that I can purchase other investments and scale up year by year? I work remotely, so I can declare a new primary every year if needed.

Hey Maria,

Can you pull a HELOC out on the condo and structure it so that the rent will quickly pay down the balance?
You can use the HELOC money combined with a low down owner occ to go after a multifamily if you're looking for more units or a larger SFR if you're looking for something more specific.

Best of luck!

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $900,000
Cash invested: $120,000
Sale price: $1,700,000

Contributors:
John Whitney, Victoria Loder

Here is a phenomenal Greenwood Point's move-in ready home completely remodeled with designer finishes throughout. Do you like to entertain or simply like open floor concept? Here is one for you! Appreciate the vaulted ceiling with exposed beams and custom fireplace. The impressive Chef's kitchen has premium ss appliances, shaker cabinets, large island with luxurious waterfall counters. Walk onto the deck off the dining room through extra-large glass sliders, and down the stairs to the back yard.

What made you interested in investing in this type of deal?

Fix and flip investment property for a client.

How did you find this deal and how did you negotiate it?

On the MLS.

How did you finance this deal?

Hard money with Intrust Funding.

How did you add value to the deal?

Fix and flip renovations.

What was the outcome?

Sold the property.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Check out the Heaton Dainard team!

Quote from @Joshua Sparrow:

I have $125k from an inheritance and am looking to buy my first investment property ASAP. My local market is steadily growing with tech and aerospace industries and has always been a big tourist destination. Being on the coast of California though, entry level prices are high.

I could potentially find a property 30 minutes inland for about $500k but wouldn’t have much left for rehab or reserves. I also have a great network of trustworthy people I could easily build a team with.

Would it be better for me to put all my money into a small property locally and utilize my existing network, or should I buy out of state and have more flexibility to BRRRR and scale up quickly?

Hey Joshua,
For your first project, I usually recommend getting something that you can drive to and check on regularly. If anything happens you should be able to get there to fix it so that it doesn't cost you an arm and a leg to coordinate work getting done. In addition to that I recommend doing your first project on your own. You want to be in complete control of the project, it tends to slow things down when there's more than one decision maker on a project. If you can partner, you should be looking to acquire private money lenders who don't mind being in second position. Try and get it so that the asset it yours alone.
Best of luck!