All Forum Posts by: Jordan Bowley

We just did that! We used a group of props we bought Apr. 2017 as collateral for the new purcahse. Our lender had a number of requirements, they had to hold the first position on the properties to be used as collateral. We had to have a new appraisal & survey on the old properties as well as the new props. The lender would only consider equity in excess of the 25% for cross collateralization--- it worked out that we had sufficient equity such that we ended up bringing less than 1% of the purhase price of the new props to the table. While there are some significant costs to doing it this way, we were out of pocket very little cash and were super happy with deal.  

You are Very Funny! "What kind of "hiccup" besides defaulting on the new properties mortgage or being sued could make this a bad idea?" (no offense meant, just having some good clean fun at your expense.)

"and I don't really plan to default..."

No one I know who defaulted planned to default. I have bought a LOT of defaulted properties and made a ton of money at it. None of them planned on it. And if ever you are successful in real estate, you WILL be sued. Attorneys sue those with money, not poor people. The attorney wants to make sure he gets paid, a Lot.

I bought (2) $500,000 houses in August 2001. I obviously had a lot of money on the line. You may be too young to remember and I don't know if they teach this in school, but we got hit by terrorist attacks in Sept 2001. That was just a few weeks after I bought the houses. All lending stopped and real estate froze. Loans were called. If I had been cross-collateralized I would have lost it all. Same when the tech bubble burst. Same when (you name the event . . .I could go on) but it happens fairly regularly.

Markets change, you can easily over guess value, market drops, changing demographics, risk exposure, black swan events, become ill, get into an auto accident, get tangled in a nasty lawsuit, etc.
But, there will never be a down day again will there? ;-)

Keep my number and give me a call if ever you need to get bailed out quickly. Oh, and it won't be for the amount you think it will be. It will be far, far less but then, what other choice will you have?

There are 3 Comments

1 .Very Not a good idea. You are putting ALL properties at risk if there is a hick up.

2. There is always a hick up

3. See Comment 1

@Jordan Bowley a lot of PM contracts REQUIRE property owners to use them first to sell their properties (of course, I always cross that out on my properties because I want the agent that sold it to me to also get the sale if possible).  So PM focused brokers usually do both, though it tends to just be the listing.

If you want to do PM, I'd focus on that.  Pivot to sales later if you'd rather be doing that but trying to do both right off the bat will be painful, they ARE different skillsets (I self managed 8 units for a while and now I'm a part time agent).  eXp is certainly NOT a good fit for PM.  Maybe eventually they'll add it.  

How long you been in?  I'm active duty as well.  eXp and my job give me the flexibility to do both.

 You will want to hang your license with a local property management company that's led by a real estate broker. In California, that's the norm for prop management companies, I can't speak to your state.

The property management company (at least in my area) will likely ALREADY have Realtors representing buyers and sellers. 

Property management = tenants = future homebuyers = why let those "leads" go to waste, when you've already got the licensing and everything else to have a few buyer's agents to help put them into a home & generate additional revenue from this? 

Property management = working with property owners = oh look there's also people that might someday want to sell real estate = same logic as above.

I bet you will not be the first new real estate agent to say something along the lines of "hey I want to work in property management, but also sell homes from time to time," the answer you want is probably something in the ballpark of "Yes! We already have a few people doing that, we'll get you trained up, including how to plant that seed early on when you are serving as leasing agent to put those tenants (tomorrow's buyers) in our units." And you might target whoever is doing property management for higher end apartments (more likely to qualify for a mortgage in a year or 3), just drive around the nicer part of town and see whose name is on the "for lease" signs. 

@Jordan Bowley

I was thinking more of a PM company to hang your license and do PM work while selling some on the side (with them). In my experience many PM companies have people buying and selling as well. An owner wants to sell off an asset it is the PM who lists it for sale. While they don't have all of the retail type stuff of the big players, they can legally buy and sell real estate (check local laws) for clients. They also generally have the people with a lot of experience around or at least a lot of connections to get things sold. In your case just go with a PM company. No sense in hanging your license in 2 separate places unless your focus is going to be mainly selling (which it isn't).

Just my 2 cents.

Hi @Jordan Bowley

As @David Bell said you will most likely find it difficult to find any national/large franchise/broker who will let you do property management in their sales space. However if you find a property management company they may be more apt to let you sell as well. You wouldn't get the training of an EXP but it may be easier to fit into what you are looking for. 

Good Luck!