All Forum Posts by: Scott Robinson

We recently refinanced our home and got 30k out with the intent of buying a home (using hard money) to rehab, rent or owner finance (exit strategy would depend on the deal).  Since we don't need 30k for a hard money loan I am thinking about using 2-5k for marketing (bandit signs, mailers, door flyers) and keep the rest handy for a purchase (or two).  I want to be able to move quickly (I missed an opportunity yesterday) but am still tentative.  Am I on the right track?  Any and all thoughts are welcome, thanks!

What % should I be setting aside for Federal Taxes on a flip that takes 4-5 weeks?  This would be our first rehab and we may do one or two more this year.  Does that fall into the "investment" category with a lower tax rate or income/business at a higher rate?  Short term capital gains b/c it is completed in less than a year I believe, but want to be sure.

Thanks

@Krisdeon Slack, I am analyzing HMLs right now and agree completely and am still trying to wade through all the fees/costs to get an accurate comparison.  Are you leaning toward a specific one yet?

I have used some of the money to send out about 500 post cards.  Half were new address, half were a second round of mailers.  For the 3rd round should stick with post cards?

So three years ago this Spring my wife and I decided to pursue real estate investing. My wife had just started working as a realtor and we saw an opportunity. I began attending the DFW REI Club meetings in Fort Worth to network and learn more about exactly what we were getting ourselves into. I am a full time teacher, football and track coach in Cedar Hill so not only do we not have a lot of capital to start us out but I also didn't have a lot of extra time. I was able to attend 4 or five meetings of the REI Club and everyone I talked to suggested to start off wholesaling, which sounded impossible, so I gave it a try.

For the next two years I bought a roll of stamps every month and mailed 100 letters at a time. I was targeting the foreclosure notices, expired listings from my wife's access and homes I saw driving around town. The first time my google "Real Estate" number rang I was so nervous, I still get butterflies every time but the conversation is easier now. Over the last few years I've taken 30-40 phone calls and had 3 homes under contract. Any time I had a question I contacted a guy I met at the first REI club meeting I went to and he would help me out, thanks Taylor Weakley. The first home I got under contract was over a year and half into this process and I think Taylor told me get it signed more for my morale than it actually being a good deal. He met me at the house and we quickly decided we had to terminate the contract, there was no room. I kept at it, my monthly process continued and then I got the second home under contract in July of 2016. There is a much longer story to this one, but it ended when title came back and said the owner owed $170k more than she had told me. It would have been a great deal, so it stung when I had to terminate.

During this time my wife was having success as a realtor and I was able to steer 5 of phone calls to her for listings.  I took the money she paid me for those leads, bought a listsource list and mailed out 400 postcards over the Summer, not a single call back.  Summer ended and I kept sending out letters every month.  January of this year I got a call on a letter I send to home near the fields my boys play T-Ball on.  Seller was motivated and ready to sell so I did what I always did, call Taylor.  He met at the house and had the home under contract in 4 days.  Much more to this story as well with Taylor doing most of the work.  Our seller had a health scare and we were not sure if he was going to make it so Taylor's father agreed to buy the home for the price we wanted.  Under contract for $85k, sold for $105k.  I was stoked!  My first deal was done, I got to open the champagne that was in the fridge for the last 3 years, all is well.  I took $2k to put toward marketing and I am still sending out letters every month waiting for the phone to ring again, I am more motivated than ever now, but my ambitions have changed.

Now I want to rehab a home.  A friend I work with has the same itch, he has rental experience and wants to get back into the real world.  Between the two of us we can finance a rehab but not the purchase, unless we find a great deal, so we are always looking and trying to meet like minded people.  My goal is to get a deal done before the Summer, his is to get 3 deals done this calendar year.  If anyone reading this is interested in a partnership feel free to reach out.

Anyone do any investing in Natchez?

Ok, my thoughts exactly.  Thanks @Steve Vaughan

Thanks for the quick response @Steve Vaughan.  My thought was that it was not a good deal but, that it was close...guess I was off a bit.  A $16k loss is a non starter for sure.

I dont think there is enough room to wholesale or flip it so I'm leaning toward passing it off to my wife for a possible short sale at this point.  Do you think there is another strategy I should be considering before going for a short sale?  I would like to get the family the $4k they asked for so I would only want to suggest the short sale as a last resort.

Got a call from a family facing a foreclosure auction 6/7 that wants to sell.  They don't want to save the home, just their credit and make $4000 so they can move out of town.

They owe $126k, as is value of $140k, ARV of $160k. Payments are $1100 @ 5.5% for 30yrs. Loan re-instatement is $26k. Home is Arlington, TX near Randall Mill & Cooper for those interested.

My wife is a realtor and has a client looking for owner financing in the area so, I was thinking we buy it sub2 and then owner finance it to her client...

Thanks in advance for the advice.

I want to share a wholesale experience from this week, a common scenario for many probably:

I got a call from a young lady about a letter we had sent her aunt.  She proceeds to let me know her aunt is in the hospital and the house is scheduled for auction in just over two weeks.  I listened while she talked and expressed my empathy and concern for her aunt.  Over the next 3 days I spoke with her mother and texted them while they tried to locate the foreclosure paperwork.  I was always patient, caring and as informative as I could be.  The first amount they send me is just over $60k, sounds good so far from my analysis but, it is not the final number.  Later that night I find out the actually amount is $115k+, so there goes any possibility of wholesaling the home.  I gently explain that the aunt owes more on the home than it is worth in its current condition and unfortunately buying is not an option for me.  They thank me profusely and let me know a couple of people came to the house offering $90k but "acted strange and creepy", hanging around the house all day after being asked to leave.  They appreciated my patience, kindness, let me know how helpful I had been and thanked God for bringing me to them.  But I haven't done anything, never met them in person!  I took their compliments to heart and appreciate everything they had to say, but still I didn't DO anything.

The above story is to demonstrate that the way we listen and talk to people has a huge effect on their desire to do business with us and what the general public thinks of investors.

Have a great day.