All Forum Posts by: Michael P.

Awesome post.  One of my favorite posts I have read on here.  

Your #2 and #3 deals are they with the same GC, same deal split etc?

When I used to flip, I only build specs now, I used to say:  You make the money when you buy, You get paid when you sell.  

Too many people worry about their first deal and how much they will profit?  All you should be worried about is all of the knowledge you will gain.  Worry about profit on the next deals using all that knowledge you now possess.  I am always amazed how people will go into insane crazy debt for college but they are scared to lose 10k on their first flip.  Just think of the first flip as education, if you make a profit it's just the cherry on top.  

1.  Get an option period.  Extend that option period all the way until the day of closing if they let you to give yourself all the time you want to back out.

2.  Hire a lawyer, or get an awesome title company that can answer those questions for you.

3.  Why not ask the seller what the deal is with the bankruptcy.  Maybe they will tell you, after all they are trying to sell the house.

4.  How does your realtor not know more on this?  

I'm impressed, good job.  Don't worry about some of the mistakes you made, learn from them, don't make them again.

I never ever pay anyone up front, unless they are a huge legit company, and usually that means I put it on the credit card, so I have extra security.  Random joe blow company who wants 50% up front?  Nah.  

My philosophy is, I am building a house, I can't go anywhere, you can place a lien, and you can easily track me down.  You?  You are a random person and I am not going to spend one millisecond tracking you down if you screw me.  So either you do the work up front and then get paid or cya, plenty of others out there who don't need money up front.  

I never had a problem sacrificing by not owning a personal house.  I owned many houses before I ever kept one for myself.  If you want to guarantee your financial future you might want to maintain that type of sacrificial mindset.  

With that said it doesn't mean you can't have both.  

Good Luck.

Obviously this is a great success story.  How is this a repeatable process without tons of cash lying around?  Is there another option of refinancing the total purchase plus rehab costs out so you can legit rinse and repeat this method?

Don't do it Greg.  It's harder to evict a tenant in Texas than to Foreclose.  It's just not worth the risk IMO.   I have always politely refused when buyer's or agents have made this request.  

One time I mailed letters to just 13 people all on the same street, it resulted in a purchase.

Another time I sent letters to a hundred people all on the same street, zero calls.

One time I sent 2500 post cards in a certain area and received 1 call.

The point is you never know, it comes down to some luck, timing, etc.

Did you post the contents of your letters on here for others to critique?  That might help.

As far as being an agent, I always write something like this:  I must disclose that I am a Texas Real Estate Broker, however I have ZERO interest in listing your home, only buying it.  

This is one of the best posts I have seen from someone looking for a mentor or info.  

My advice when approaching someone is to be Humble.  You're going about it the right way.  Try driving around to rehabs or builds and see if you can find the guy in charge.  I've been willing to help others out with questions, advice, contacts , etc over the years.  I am happy to help others out as I believe it will be returned elsewhere.  

I remember one guy approached me on the site and he was looking for a particular type of sub.  He was in need of help and didn't boast or anything just asked if I could help.  I did, and then I offered him tons of additional advice just to try and help get his business going.  

Keep looking, I think you will be successful helping someone.

I see you're an agent.  I would offer to give someone a 100% return on commission or something like that in return for picking their brain while you are driving around looking at potential deals.  I think you might pique someone's interest with that offer.  

1.  Understand if he is developing something on that scale he is insanely busy.  Even 5 minutes is worth hundreds of $$ to him in terms of time.  I would personally pay the guy $1000 an hour for his time, and I would guess he would politely say no thanks.  Yes, he makes well into the $1000 an hour range.

2.  You need millions of $ or insanely wealthy backers to do something on this scale.  Remember that when you are talking to him.  This is most likely a very seasoned and wealthy person.  Time is the most valuable asset to him.  

3.  Unless this guy is just very nice and believes in karma I don't know how you can reasonably approach him.  I do like the way Jason has recommend though, that is the most reasonable way to get your foot in the door.  If he says no, ask him what type of deal he is looking for.  

4.  If you think shadowing him or working for him will work, ask him what is the most annoying aspect of this right now for him, then offer to do that.  Once again more than likely time is his most valuable asset, how can you save him time.  

5.  Do you have a service you can swap, for example maybe you are an awesome programmer.  Maybe you can build amazing landing pages or websites.  Offer to trade knowledge.  $ is of no interest to this guy but I would wager knowledge is.  

I was in the same boat as you. Here in Dallas finding a good flip is very challenging right now, so I decided to start building specs this year.

It is a very daunting task even for someone who has flipped a large amount of houses. Here is what I did.

I contacted all of the builders I could find in my area that seemed to be successful spec builders. Guess What... None of them had any interest in talking with me, and I was offering to pay them. What I have come to learn is why in the world would a guy making 100-200k+++ on a single build be willing to waste any time with you, even for a few hundred an hour. It is seriously a waste of their time, unless they just want to help.

I did get very lucky and one of the bigger guys here sat down with me for a few hours. I offered to pay him and he declined, wouldn't surprise me if his hourly was well over $1,000 an hour, so naturally my offer was pennies for him.

Another thing you can try is just stop by all the job sites and see if you can get lucky to find the GC there. Many of the established spec builders have GC's that are making only about 100k a year or so. These guys would probably be very willing to sit down with you for $100 an hour or so, as that is still great money for them.

Good Luck, building a spec house IMO is way easier than flipping, it just takes longer.