All Forum Posts by: Brian Fouts

@Anthony Dennis, @Kurtis Jacques, Run, run away fast.  These guys are NOT legit.  You call their references and it goes to google number and the same guy will call you back.  

Ask for references, ask for specific addresses of previous projects.

Western Union to give them a loan processing fee is a dead giveaway.  

Notice that all the external Social Media links actually link back to the website main page.  They don't have any social media.  

All numbers are google numbers.  

Their business address is some building that doesn't have a website showing the tenants. 

If you believe that money is holding you back, your right, it is...

Change your belief structure and you can change your life.  

Many of us here on BP got stared in RE with no money and have succeeded, you can do the same.  It is why a lot of people start out wholesaling.  I started out doing owner financed real estate with no money  

Welcome to the forum Tek!

Lending is one way to get started passively, you just need to be sure that it is done with a local and reputable investor that has experience to back up what they are doing.  

We have a few rehabs going on right now and have private lenders involved in them.  One partner is getting equity in the deal, so they get a share of the profits.  Another is just acting as a lender and getting an interest rate.  This person is also secured via the property and is also secured via a second property as additional collateral.  

This is probably one of the best websites to find info.

We have contracts/notes that we could provide to you as examples for you to reference.  

Overall, just get out there and start meeting investors and real estate professionals.  

That depends on your level of real estate knowledge and if you have a contractor that you know and trust.  How are you going to find the deals, how are you going to fund them?

Doing fix and flips requires a lot of knowledge and that is knowledge that can be gained by experience, but it can be painful knowledge to gain and there is a lot of risk in doing rehabs without experience in REI. You can learn a lot by partnering with a knowledgeable, partner or builder that does rehabs, but what are you bringing to the partnership?

On the other side of the coin, wholesaling (at least good wholesaling) also requires quite a bit of real estate knowledge, it just doesn't come with the risk that flipping does.  

Hard money lenders exist because of demand (they are in demand).  If they are good ones and local, they can be great to work with.  They can also source deals if they are that type of lender.  Expensive, yes, but if you have deals that have enough margin, then go for it.  

We have a few hundred thousand lying around.  We have four rehabs currently going.  Three are using hard money.  If we used all cash, we would only have one going right now.  And the profit wouldn't be all that greater on that one and the profit on that one with all cash would not even be half of the profit of the other four combined, so...

Helps spread the risk around as well.  

Just be careful talking about averages.  If the stock market averages 11% (which I don't buy at all, but that's just me having done a lot of research for myself and our clients), it doesn't necessarily mean that you are making 11%.  In fact, I just about guarantee that you are not averaging 11%.  That would be amazing.  But keep in mind that everyone views the returns, averages, and numbers differently.  Some take inflation into consideration, some don't.  Just because the S&P gets a certain return, your return is actually based upon what stocks you are invested in or how you are invested in the stock market.  Investing through a mutual fund, which most 401k plan are in, reduces your return over time dramatically.  Fees, compounded over time, have a big impact.  If you are investing direct in the stock market, you can do better of course.  Active versus passive and all that.  

But, just my opinion. And I pulled my last bit out of the stock market 8 weeks ago (was in 401k and rolled it over to IRA). I've also had fixed return (10%) investments in other IRAs for over 5 years and they have massively out-performed the 401k WITH contributions.

@Logan Allec, yes, $45k is enough to loan on any real estate project, you just have to find the right investor.  We currently have a $350k rehab project and a private lender is lending $30k on it.  As a private lender, you don't have to lend the entire amount of the project, you could be a gap lender (not as secured, though), etc.  Our fund just accepted an investor with only $10k, but they are getting 10% fixed with no fees.

Don't let the amount you have be a limiting factor, it is not.  You want to lend on one of our projects, feel free!  Kidding aside, there are a lot of investors that will utilize your funds, you just need to be sure to vet them properly and make sure you are secure.  As an example, we often offer first time investors on our projects additional collateral.  Since we own many other real estate properties, they will be secure via the property they are investing in, but they also get another property as collateral, so they are double secured.  

Oh, and since you said you have funds to invest, you are going to get people trying to sell you their program or product, so just be prepared.  

Ditto what others have said.  We have done lease options, mortgage wraps, etc.  Don't assume anything until you talk to the sellers.  Don't assume the existing lender has to approve what you do.  

First and foremost, find out the sellers true motivation and "pain" point, then bring them the solution.  Not to rag on agents, but most agents aren't going to bring the solution to the seller for you, especially if it is creative.  

Yes, there are meetup close to you.  Go to meetup.com and you'll find them there as well.  

Seller financing or seller carry is great, it is how we do a lot of our real estate deals.  My office is fairly close to you (Lake Stevens), feel free to reach out.