All Forum Posts by: Jeff Johnson

In my last post I asked in detail how to find sellers and good deals. Now I want to focus on how to approach a potential customer. When trying to buy directly from a home owner how do you generally go about that. It would seem many times they are probably going to be very stressed and very leary of any investor coming to them about their home. How do you address there worries?

Once you have addressed that what is your general strategy for making the offer. I am guessing you probably have 2 or 3 options you would throw at them. I would love it if people who do this would give some details on how they make the offers and if possible a step by step account of how the deal really works. Things like seller financed and subject to are still a little confusing in the details. I get the idea behind them, but need to see from start to finish how one would go about setting up a deal like that and how to present it to the home owner.

I know I am asking for a lot here. But the more details I have the better I understand. And the faster I can get going. Need to get out of my Job as soon as possible. Its slowing taking extra years off my life.

Thanks everyone.

I am pretty close to taking action. Still working to get the funding side of things figured out. So I though I would try to get some more in depth details on how to find and do deals.

My Main Goal as of now is to find 50 homes and rant them for a minimum of 100 a month cash flow. My time frame on this is 5 to 6 years. After the first 10 are under my belt all the cash flow will be put towards the principal of the lowest Loan Value with a goal of getting half the properties paid off in the next 5 to 10 years. Once a couple are paid off it will go pretty fast it seems. I will be working full time until I can bring in 10K a month. Just not an option any other way.

Here is my biggest issue right now: How do I find the deals? ya, I know I need to get out of the house and go to local REIA meetings and such and I have been in contact with investors that are also real estate agents. But how do I find deals that are not part of the MLS? The FSBO types or Distressed properties or the people that just have tp move and move now.

In my last post I saw that Rich Purchased 63 homes in 18 months. Is the whole thing just who you know? Do you market to people who are close to loosing there home? Use Craig s list? Signs in Yards or on Corners? New Paper ads? These investor meeting tend to happen once a month and it takes time to build relationships with people. Seems like a long road to getting into the business.

Thanks for the help.

Thanks for all the info guys. I appreciate it a lot

I will check out the local REIA. I know a couple of investors in the area. So I will hit them up for advice as well. Being somewhat new to the area, it would be good to get out and meet people anyway.

So with a commercial loan you just get one per home like a mortgage? Or would you have one large loan amount that you can use to group home in? And the big question is do you need a full business plan to show the bank and collateral.

Jon: When doing the Refi can you wrap in the closing? I am not apposed to pay cash for the costs but if can avoid it I would.

Mike: When you are talking Commercial loan, how do you mean? Do you just take out a standard loan to by the house. In this way you don't need a mortgage?

I am looking into other options to finance. As far as the hard work, I assume you mean getting out and talking to people. I know I am not going to find many 50% deal on the MLS. So basically it comes down to a who you know game then? I am willing to do the work, not a problem. Just need to know what work to actually do first and get it down on paper so I can have something to follow.

I appreciate all the help with this. It has been very helpful.

63 homes in 18 months? That's crazy. I want to do that. :D What do you do with that many that fast? And what type of homes?

The area I was looking in is mostly bank owned stuff and was going pretty cheap but everything needs to be rehabbed. Maybe that is not the right way to do it now. I am pretty much open to anything right now. I don't want to deplete all my cash, but am willing to spend some of it.

Scott: How easy is it to actually get a refi after 6-12 months? Do they require money at that as well. And if I was to put The homes into a LLC after I get the mortgage would that still count towards the 10?

Hey All,

Just a couple questions. Are there still no money down deals to be had? For example I get a house and have an ARV of 30% under appraisal. Am I going to be able to find plans where I put money down to get the rehab financing and when its complete get the 30 year and get that money back as its at 70% of the actual Value or are appraisals pretty much a non-issue now.

And would 50 houses in 5 years be a totally unrealistic goal in today’s market? 70K is the most I will pay including the repair. Rents in the area average 1100 to 1500.

I have probably 30K cash to work with, but I would rather not plunk that down on a couple houses and then have to stop.

Oh, I am in Minnesota if that matters.

Thanks