All Forum Posts by: Kyle McCorkel

@Matthew Shultis

Hard money or private money.

But if 4 people can’t come up with $80k then that’s a huge red flag...

Not to mention a 4 way partnership sounds like a disaster waiting to happen...

@Ryan Rudy

Hate to burst your bubble, but I've got 5 years experience, few dozen deals, built multiple lender relationships, and still can't get an unsecured LOC greater than $25k. So don't get your hopes up too much.

To answer your question cash discount depends on motivation level and exasperation level of the seller. You can get a giant discount if you find a seller who just had a buyer back out because of a bad inspection or financing fell through. If the house was just listed with an agent, is in perfect condition, those people can probably wait for the higher offer that includes financing.

Most of the stuff on the MLS right now is overpriced junk. Be very careful finding good deals on the MLS. There's a lot of buyers overpaying for properties right now. Be sure to factor in your full rehab costs, holding costs (interest, utilities, taxes and insurance), closing costs and profit margin. Most buyers don't fully account for all of those items.

Are you flipping or BRRRRing?

@Dean Deimler

Yeah I’d look into the details and see what is included in that 7k. They typically break out your escrow costs from all of the fees.

If you provide the size of the loan, terms, and breakdown of the costs/fees then we could help you a lot more. I’ve paid 7k or more in total closing costs and I thought they were pretty sweet deals.

@Kenneth Garrett

Awesome thank you. Looks like your business is set up similar to mine. Mostly BRRRR's with a few flips here and there. I'll have to try the direct from bank acquisition model, sounds awesome with a lot of advantages.

@Kenneth Garrett

Can you add some more detail on how you got your foot in the door with the local banks? Are you buying from them truly off market (no agents)? Did you call all of them when you started, did you send them letters, etc? I’ve wondered about this but could never figure out the best approach.

I’m with @Ian Walsh

I'd love to only buy places built in 1990 but that's just not where the opportunities are. I've found flips built in the 1950's - 1960's with solid foundations (and have never been updated inside) make the best money. About 80% of my rental portfolio was built 75+ years ago. I do a lot of BRRRR's and just make sure to update all major mechanicals and fix structural issues before throwing a tenant in there.

We are flipping a house that’s probably 100 years old and practically rebuilding the whole thing. But we will still make a lot of money on it. It’s all about the numbers.

I agree with those stating that real estate is inefficient. In a highly liquid and uniform market like the stock market, which has thousands of buyers and sellers, then whatever the item last sold for is the market value.

Real estate is not uniform and not liquid. It’s not uniform because every property is unique. Maybe it has the same builder as the house next door but it’s gonna be in a different condition with different characteristics. It’s not liquid because in a given market or sub market you have a limited amount of sellers and buyers.

The closest the market gets to being efficient is when a property is well marketed on the MLS. Then it's being presented to a large number of buyers. I think in many cases the winning buyer overpays. They overpay because if they wanted to resell that property right away, they'd need to sell at a loss. Everybody else wanted to pay LESS than they did!

Off market, direct to seller is a different story. Those deals can still be overbid (I compete against these offers all the time) but off market is your best chance to truly get a good deal. Best case is you get a great deal because the place needs a lot of work, and you value the rehab cost correctly while the seller might overvalue the rehab cost because it just seems too overwhelming to them.

@Richard Clark looks good and thanks for the details and recommendations!

@Colleen Hunt

Hi, full time REI here. I'm based in Hummelstown but I look for deals a lot over in Camp Hill as well.

I don’t want to go into too much detail, but I’d just want to caution you to make sure you’re getting a good deal. There’s so many people overpaying for properties in our market. I’m not saying some of them don’t make money in the end, but I think most of them don’t, and the ones that do need to get lucky.

Also, make sure you value your time. If you profit $5k on a deal, but you did all the work yourself and it took 500 of your hours over the course of a year, congrats you just took a part time job paying $10/hr.

Feel free to message me if you want more market specific details.

@Cameron Tope

Maybe I would, but lenders require it and all my properties have a mortgage