All Forum Posts by: Jonathan Towell

Hi Tan,

I wouldn't assume wholesaling is a good place to start. I've never done wholesaling and probably most investors I know also haven't done wholesaling.

Personally, I would recommend reading Rich Dad, Poor Dad to get a good mindset. Then, I'd recommend reading Hold by Steve Chader and Jennice Doty. Maybe check out "The Complete Guide to Buying and Selling Apartment Buildings" and the books they have on sale at BP.

Anyways, I don't recommend over-researching without jumping in. But, I just want to make the point that wholesaling is not always the best way to start.

I wish you the best!

It can take a long time to know a market, even one where you live.

A few years ago, we started buying lunch for anyone we met who owned real estate in town. We wouldn't talk about ourselves. We'd just ask them questions the whole time, like these:

- What property do you own?

- Why did you buy that?

- What would you not have bought if you could do it over?

- What kinds of properties do you look for and why?

- Where can a young investor make good money in this town?

- Who do you know that we should get to know?

I could go on all day. Very few veteran investors have turned down a free lunch to talk shop.

We try to do this about once a week, but sometimes end up doing it 2-3 times.

Now we know market much better. We also know many of the players in the area and have good relationships with them. Anytime we have a question about an opportunity, we've got a list of people we can call.

In short, the best way to quickly learn a market is to cheat and ask the people who have already mastered it.

I wish you the best!

You are a smart man! Leverage on assets is great. But, you'll always sleep better at night when you have some cash savings.

@Patti Robertson I'm not sure yet. First, I want to learn the business. This particular opportunity may be a way to flip some notes.

Is the discount so steep because the asset is depreciating? Or because of the credit worthiness of the borrowers?

If notes should be discounted pennies to the dollar, why do big manufacturers like Clayton carry billions in paper?

I'm looking for someone who can talk to me about buying a decent portfolio of mobile home notes ($450k+). Anybody know the expert in this field?

@Belinda Lopez It sounds like the city will pay for and handle moving the home (in the event it isn't abandoned and the tenant can't pay). Is that correct?

I'm interested in the same question and looking for MHP deals too.

Capital takes a lot of time to deploy. So, if you find a fixer upper, it might eat up a lot of your time. On the other hand, returns on fixed up properties can be lower.

I'd guess it is really a matter of preference.

I highly recommend The Mobile Home Park Investing Podcast by Kevin Bupp and Charles DeHart. I don't exactly recall them picking a side in this debate, but I do know they discuss the pros and cons of each approach thoroughly.

Mathematically, it looks like the numbers work. However, the fact that the rent request is so far off market rent, makes me wonder about the catch.

- Does the "seller" need a down payment?

- Is the seller covering all expenses, like insurance, taxes, repairs? If not, those might eat up the spread.

- Is this thing a dog with plenty of deferred maintenance?

I'm no attorney or CPA, but it sounds like you're doing it the tricky way.

So, you and partner A split an LLC 50/50, then buy Asset A.

Partner B comes in to help buy Asset B. 

There is no way to bring in Partner B without either you or partner A getting less than 50%.

So, the answer is to create a new LLC every time you have a new equity structure.

You don't need to have a new LLC with every asset, just with every partnership.

It won't hurt my feelings if you confirm with a professional. :)

Looks like a great deal. Nothing wrong with 30% cash-on-cash, especially since you have an opportunity raise rents even further.

The only thing I noted right off the bat is that you mentioned needing some repairs, but I don't see an up-front capex budget.