All Forum Posts by: Jonathan Towell

You might check out Upwork to see if you can hire a programmer to write  a little browser plugin for you to do that. I'd expect something like that to take about 3-6 hours.

https://www.upwork.com/

Sounds like a fun project. You might check Upwork.com to see about finding a programmer to write a little script to do that. I would think something like that might take 1-3 hours.

https://www.upwork.com/

I agree that insurance looks high and that you need 10% of gross revenue for repairs.

BP has a tool to analyze deals you might check out, but it is for pro members.

Also, I really liked HOLD by Gary Keller. The book is a great primer for analyzing deals.

After you rework your numbers, I'd love to see them again. Personally, as a newer investor, I'd like to be seeing $200-$400 cash flow per month.

You might ask a realtor friend to run a quick CMA (comp) on the property.

But, let's assume the tax appraisal is accurate. Every bank we've encountered is going to want 15-25% down on the sale price, regardless of the appraisal. There are strategies to get around this: seller finance, pledge another asset as equity, lease-to-own, etc. I have not read it but Brandon Turner's book looks like a good resource:

http://get.biggerpockets.com/nomoneydown/

I did read this one and it was pretty good:

http://smile.amazon.com/Nothing-Down-2000s-Dynamic...

That said we only do deals where the exit strategy is clear. On single family homes, our exit strategy is sale to owner occupants. If we buy a house for $40k that appraises at $40k, then we have no way to exit the deal without taking a loss. It doesn't matter the cash flow. If something happens, we need to be able to sell the property immediately, pay a realtor, pay closing fees, and not take a loss.

Should you buy the house? I'd recommend getting the CMA. If the sale price is over 10% less than the CMA, then you have an exit, which is the first strong signal that the deal is worth considering.

Many mortgages have a "due on sale" clause that gives the bank the option to call the note upon sale. However, in my experience, most banks will not call the note if payments are being made. We recently entered into a wrap deal with a seller financed purchase. The title company had to ask around for an attorney that would draw up the right paperwork. But, it was worth it. So, unless you asked the bank and they explicitly forbade it, maybe a wrap deal is not out of the question.

If your goal is to reinvest the capital one idea might be to put some kind of a recurring fee (penalty) besides the standard payment. For example, every six months, the buyer has to pay an additional $1,000. Such a penalty might act as motivation for the buyer to refinance the deal into long term financing with a bank or other lender, thus freeing your capital for other uses.

If the buyer is willing to put 25% down, it should be no problem to find a bank to refinance the deal. But, that raises a question... if the buyer has cash to put 25% down, why does he need you to finance the deal in the first place? Does he have poor credit and can't get a loan from a bank? I would explore that a little further. Are you willing to burden a risk that a traditional lender wouldn't?

Hi Jarrod,

Welcome to BP. My business partner and I live and operate in Lubbock. We've been hard at it this year.

I'm really hoping another Lubbock investor chimes in and provides some secrets to flipping in Lubbock. We are primarily buy and hold. We've looked at a few houses as potential flip candidates, but haven't been able to find one that would make obvious sense for a flip yet. We know some guys that flip and all of them have been moving to higher end properties to make their numbers work. The numbers at the lower end of the market (<$200k) seem to be squeezed such that the margin isn't there.

I don't mean to discourage you. I'm sure there are good opportunities for flips. I hope you find one and teach us how to play that game. :)

Feel free to stop by our office some time. We'd love to meet you.

Hi Ricky,

There is a REI group that meets at Harrigan's, the last Tuesday of every month at 11:30 AM. I think it is $15 to eat. I have not been yet, but I intend on going this month.

Also, I'm one of the owners at Monterey Self Storage at 5201 Indiana Ave. We are generally there from 9am - 5pm on weekdays. Feel free to stop by and meet us.

I've got a few friends who are Lubbock policeman. I bet we've got a few mutual connections.

I like #3 as well.

My wife and I did option #1 back in 2006, except we held onto the home and now rent it out. That worked out well enough. But, if I could do it all over again, I would have bought a duplex or even a fourplex, lived in one unit and rent out the others. By living in the property, you can get an FHA loan. Today, it is possible to get 30 year mortgages at 3-4%. A mortgage like that on a duplex or fourplex would be sweet.

Hi Brian,

Have you found what you are looking for? Here are a few property management companies, though I'm not sure if any of them are turnkey:

Westmark : http://www.lubbock4rent.com/

Minnix: http://www.minnixproperties.com/

Sterling Creek: http://sterlingcreekonline.com/

If you find a good one, let me know.

What are you looking for in Lubbock?

Hi Zach,

I'm a buy & hold investor in Lubbock with plenty of Realtor contacts. I'd be happy to take a look at your property. Want to post the address here? Or message me with details?