All Forum Posts by: Brant Richardson

I would love to know how many bags of cat litter it took to fill the house.  They probably could have made the place beautiful for the cost of the cat litter.  Junior grew up so happy there, the whole house was a sand box.

Amazing job.  My wife laughs at the pictures of houses I am interested in and says "that's a tear down".  I'll have to show her your before and after photos.  Thanks for sharing it.

@Tom Scott 

 You pretty much stated the benefits of each... cash flow or cash.

Flipping gives you a big chunk of cash.  Now, how do you best invest it?

Buy and hold gives you a small chunk of cash every month.  Build up enough of those and you have a big chunk of cash every month.  Wealth.

If I was flipping it would be a means of building capital to acquire more buy and hold properties.

@Robert Leonard I have made quite a few phone calls.  It has not been hard to find somebody who will do a cash out refinance on the purchase price with out a seasoning period.  However, I have yet to find a lender who will do a cash out on the market value in less than 12 months, not giving up yet though. 

Always reserve enough capital to do your flips. When you have enough to keep one and still have enough left over for the next flip, then its time to hold on to one. After a year of seasoning you can do a cash out refinance and get all your cash out for further deals. The lower end houses tend to have a better cash on cash return (and require less cash to hold) so you hold those. The higher end houses tend to have a higher spread so you flip those.

You don't ever own the property in your name with a subject to, you just get it under contract. You are a middle man who sets up a deal between the owner and the buyer. You get paid for solving a problem for both people. The seller can't sell the property because it is in bad shape or some other problem. The buyer has a credit or income problem so they need seller financing. They are both in a situation where they can not get a really good deal but you can at least get them A deal.

If you bought the property then sold it with seller financing, it would be a rent to own type of situation. The beauty of the subject to is very little or none of your money is involved, you are using the existing loan so nobody needs to qualify for financing (beyond you deciding they are well enough qualified).

The podcast will not give the actual nuts and bolts, paper work etc. to make a deal possible. It just gives a good look at the overall strategy. If it is a strategy you want to pursue you will need to do some serious reading. I have never done one before so couldn't guide you, but I am really interested in a strategy that turns what most people would consider a non-deal into cash flow.

The buyer gives you a down payment, money in your pocket. Then the buyer makes monthly payments which are larger than the mortgage, most of that money pays off the mortgage but the rest is cash flow in your pocket. You need little or no money to do this, you need a very motivated seller and the right buyer though. It is a complex strategy, listen to the podcast a second or even a third time, I did.

Once you have 5 loans lenders require you to have reserves to cover 6 months of P&I, tax and insurance for each loan. I figure the best use of my IRA money is to have it in investments that can easily be made liquid like stocks, that way my IRA can be used as reserves and be invested at the same time.

If you haven't checked out podcast #70 yet, listen to it. It's amazing what this guy is doing turning non-deals into solid cash flow.

Real estate should be your secondary concern. Your father is about to give up his incredibly lucrative business. Step into his shoes and run that business, make real estate a hobby on the side.

If you are getting anywhere near 2% in a place that you want to live, it's a home run in my opinion. If you can get paid to live in your home, its a home run in my opinion.