All Forum Posts by: Jennifer Talcott

First, I'm fairly new also, so take anything I say with a grain of salt.

The 70% ARV rule that was laid is really good. The only thing I would add to it is: if you're going to assign to a flipper, you would probably want to subtract her profit AND non-rehab expenses from your offer.

In the example above, the maximum offer was $48,000 leaving the flipper with $30,000 after rehab.  However, the flipper is going to pay closing costs, twice, and another 6% to an agent when she sells.  So, that only leaves about $20,000 for profit AND expenses, which is usually too low for a flipper because you could easily eat up $10,000 on unexpected rehab costs.  You could also get stuck holding the property for longer than anticipated which incurs more holding costs.  Also, if a flipper is using hard money,  that's a hefty chunk - could be $5000-$10,000 on the example property.  

These are the things that the wholesalers I've talked to haven't taken into account.  It's also been my experience that those deals really take some work to find.

However, it sounds like you are on the right track and willing to learn and do things right.  I wish you all the best in your new career.

HM lenders I've talked to charge 3-5 points, 12-15% interest for 6-12 months. They only loan 65% ARV and they hold the first mortgage (I think it's a mortgage) on the property so they can foreclose if they need to. In my opinion, it probably doesn't make much sense to consider loaning on a flip for much less than the HM lenders. It might just be better to take a cash offer if you need to be done with stress for a while..... Have you countered any of the cash offers?

ok @Jay H.

I'll bite too.  Would you please PM me the secret sauce?

Thanks @Doug W..  I appreciate your thoughtful and honest tale.  

I'm another newbie who has often been tempted to pay too much for a property.  I've made dozens of offers and had most of them turned down.  The one or two that were accepted, I had to back out of after re-running the comps (yes, I had to make the same mistake more than once to finally figure out a method that would make running tricky comps easier for me - I'm normally a fast learner, but for some reason, that lesson didn't click for me the first time, lol).

My main takeaway from your story is, "don't overpay for a property", no matter how tempted I get. 

BTW, I finally got a contract on a property that I believe I can make some money on, and I'm lined up with a good contractor.  We'll see how things go over the next month or so :)

If you know you want to work in real estate the rest of your life, the ranking of the college might not be that important. 

However, if you're not sure that this is the career you'll be doing forever, you may want to stay in Gainesville and look a little harder to find a job.  If nothing else, you could get your license and become a real estate agent...  You could also talk to some busy RE agents and see if having a license (or some other skill) would make you more valuable as an assistant to them.

I'd recommend hiring a real estate attorney to figure out the best way to structure the deal to limit your liabilities.  I'd also have your attorney handle all of the paperwork.

Happy Birthday Josh!!!!  Thanks for all you do!

I'm very business oriented too, and for most of us, I don't think it's in our nature to give something away that we've worked for.  But it is in our best interest.  Yes, your gut and logic, say that if you wait, you will have more to give.  But human nature says that if you wait, you won't give at all.  Plus, personal experience, and watching others, has proven that to me. 

I literally have to decide ahead of time when, and how, I am going to give or else I just won't do it.  There are always plenty of other really important places to use the money.  And, when it's time to give, I have to force myself to write the check, expecting NOTHING in return.  But, the truth is that I always get a huge return on that money.  Nothing else can enrich, and bless, me like helping someone who truly needs it.

Our project this year has been a retired missionary couple in Honduras who take in girls from horrible circumstances and raise and educate them.  I can't tell you what a huge blessing it is to help give them the means to take these kids out of abuse, neglect, etc. and offer them a chance at a better, healthy life.  Money is just money.  But when it's used as a tool to bless others, it becomes true wealth.

Contact an attorney to find out what your legal options are.  I personally wouldn't want to close on the property if it was missing those items.  Check the contract to see which personal property is supposed to stay.  Get your realtor involved.  Let her know you do not want to sign anything at closing unless everything is intact, especially the condenser.  Do a walk-through of the property on the day of closing just an hour or two before you're scheduled to go in and sign.  Take the camera as Bob Bowling suggested for future proof.  If your attorney approves, do NOT sign anything if any items are missing.  Your realtor will likely want to contact the listing agent to discuss what is happening and how to fix the problem.  

Disclaimer:  I am not an attorney and I do not represent my opinions as legal advice.  I am simply stating personal opinions based on past personal experiences.

I'm grateful to say that I found BP right at the beginning.  I knew I had enough knowledge to be dangerous, and that I had a lot to learn, so I actually googled 'real estate investing'. BP was on the first page, and I was so excited when I started exploring this forum because I knew right away that this is the real deal.

I've only been in this for a few months, and my head has been swirling the whole time. I feel like a sponge that is finally starting to get a little damp. I've been reading books and posts, listening to podcasts, going to REIA meetings, networking, looking at properties and trying really hard to get one of my offers accepted (I KNOW it's going to happen sooner or later) :-)

Anyway, I love BP.  I learn really good stuff every time I come here.