All Forum Posts by: Luis Montanez

Another point of advice is to take the time to mature at a pace that is right for you.  

Don't let some guru charge you $15k to visit your home to help you set up your RE business. (some one actually called me to offer this)

Just like all fruit, it is more sweet and it taste best when it matures at God's intended cycle, once we accelerate the process with hormones and non natural stuff, fruit will not taste as sweet.  So take your time but take action   

The question about what to do, where to start, who to call.  The short answer is that sky is the limit.  Some of us got into RE at 19 barely out of high school not knowing what we were doing, but you eventually you learn.  RE is like swimming, you can learn theory on books and internet but if you do not jump in the water, you will never learn.

The first things I would do is :

1. listen to every BP podcast 

2. down load the deal analyzer spread sheet and start looking at deals to become familiar with the terminology.

3. by listing to the podcast and looking at deals, come up with a game plan

4. come up with your financial strategy.

5. start biding on local deals  

There is the possibility that you may scrape your knees a little at first (not do the bast deal) but it would be better than doing nothing at all.

Welcome to BP @Melissa Chinn ,

Ensure to read: http://www.irs.gov/uac/Like-Kind-Exchanges-Under-I...

and I would advice you call the Free IRS number if you have general questions of 1031 exchange.  I use to work at IRS and the information provided at the call centers is valuable.

I advice you do the two things above first before spending $5k in a guru course or spend thousand in professional fees.  Good Luck

When financing or even when buying cash.

Has anyone master a way to shop and get the best deal for settlement services?

According to RESPA rules (Real Estate Settlement Procedures Act) we are free to select what ever service provider we want.

Currently I am guilty of going with whatever the RE agent or lender recommends. 

But how to ensure we are not able to get a better deal if we do our own service provider search?  In my opinion, systemising this aspect could add to the bottom line.

"If you are taking a loan to finance your purchase, here are some common closing cost expenses

• A closing fee for the escrow or closing agent
• Preparation of legal paperwork
• Appraisal review fee
• Credit report fee
• Underwriting fee
• Mortgage insurance
• Survey fee
• Pest inspection fee
• Notary fee for authenticating signatures on legal documents
• Homeowner's insurance
• Courier and overnight delivery fees
• Tax service fee
• Recording and transfer fees"

This issue you are concen of is what "Wantapranures" do.  for a definition of this and to see if you fall in this category check out the first 3 min of the following video.  The first step to improvement is recognizing the problem.

http://youtu.be/1LZU8oa2RqQ

My best advice it to focus on what will make you money.  once you have made money and prove your business model then focus on trademarks, websites, etc.

With a budget of 3K per month I would:

1. Assemble a team of about 10 VA's (from the philippines) to do the following task:

a. Do internet research to do the following:

i. Create a list of every waste management company in my farm areas 

ii. Food Delivery

iii. Moving Companies

iv. Cable, telephone company, etc.

v. any other service that I can think of that drives around the areas of interest.

b. Once list are created they are to call each service provider and explain the incentive program to a principal  of the business.  the incentive program would be something like:

i. $2 dollars for a front picture and address of any (non duplicated from same company) property that seems abandon (closed, uncut grass, overflow mail box, etc.) include a cap per month.

ii. explain to the business owner that if he directs his employees to do this task it could mean additional cash flow for there business.

iii. once you have a list of business owners that get on the program, have the VA's follow up with them on a monthly basis.

c. once data starts coming in have the VA's compare the obtained list with a list of houses listed in MLS to ID houses not listed in MLS

d. Have VA's take the non MLS houses list and find out through public research who are the owners and status of such properties, ARV's, and other required data.

e. Have VA's create mailing list to market to these houses.

f. every month repeat process

2. Contact Divorce lawyers to explain a referral incentive plan 

3. Contact bail bonds business to explain a referral incentive plan

I have 100 ideas to long to list....

For now since my budget is low, I do something I call "cash for fitness" which means that I go to my farming areas to:

walk for dollars,

run for dollars

bike for dollars

If I see a prospect I take a pic. with an app that will record the address and a later search it.  Or if I see the owner outside approche them to give them my elevator speech and business card.

The plan that I explained can easily consume your $3k

@Account Closed Attempt to sell your SFH (at a good profit), have a line in the contract which states that the buyer must give you 3 months to find a new home (have a few houses lined up).

Once you show the lender that you have a contract to sell your current house, the loan amount may not count against gating your new loan.  This strategy could even help you downsize to a less expensive house so you can increase your discretionary income

@Ian MacLeod  Based on my experience, the lender will lend you based on the purchase price (not the Appraised value).  

One way would be to (some how) have the title transfer to your name and 3 months later do a refinance based on the Apprised value.  The seller must be willing to work with you by doing a "subject to" , "purchase option" or some other similar contract that will allow you to transfer the properties under your name or entity.

Also consider the tax implication when transferring property and IRS rules for "discussed sales"

However, good luck with getting a loan (non recourse) of that amount with an LLC, especially if it haves less than 2 years and no financial statements that shows that the business is profitable.

Call Home Depot or Lows and ask them to come out and give you a free estimate. have them brake it down by cost of materials and labor.  This will give you an Idea of  20% to 30% above the price you could get when biding it out to 2 to 3 other contractors.  Also consider building permanent cost and holding cost.

1. Take a lot of pictures of the house so you can have less buyers go to the house.

2. Ensure that the prospect buyers show you proof of funds so they are not wasting your time.

3. Read the contract, check this with your state real estate law (or) talk with a Realtor, but to my understanding (base on state of GA) every contract can be assigned to another buyer "unless" it states in the contract that it can not be done.

4. Tell the truth

5. If the seller wants to back out because of this, you will have right to get your earnest money back.

Once you have the house under contract, what you do with it during that time (if allowed in the contract) is your business, as long as you pay and close on the agreed terms.