All Forum Posts by: Lynn Dee Murrow

This situation is quite complex. It will probably require $100k plus to proceed. Contingency lawyers are not interested because of Arbitration clauses in the contract. Most victims of this company are now broke or worse, they are looking at the fall out of signing in full recourse loans that have been foreclosed. They will need to get everyone together to be most effective. I hope one or more can get the attention of their state attorney general and the SEC.

Just a note - Lifestyles Unlimited does not provide syndications to invest in. It is an education and mentoring company. The members of Lifestyles Unlimited tend to invest together once they get the education and certifications offered, and there are both accredited and non accredited investors in the group. Hope this helps!

@Steven Ferguson Lifestyles Unlimited is a real estate education and mentoring company. Lifestyles Realty companies serve Lifestyles Unlimited members but they do not do mail, text or phone call campaigns for properties. Anyone who owns a property and has a different mailing address is getting bombarded with calls, text and old fashioned mail offers to buy. These usually come from wholesalers looking to pick up distressed properties. There are classes out there teaching wholesalers how to find this information and suggesting techniques for grabbing attention. These have been around a REALLY long time - the roadside "bandit" signs were used before technology allowed more intrusive techniques. I answer and let them know my house is in tip top shape and I am not selling, then ask them to take me off their list. It costs them time and money to market to me so most will remove me. If they do not, I block their number. I kind of like the post cards with a recent picture of my property because I am a remote owner so I get several pictures a year to verify my residents are caring for the property. Hope this helps, I know it is frustrating.

@Cameron Tope I have a pretty free form schedule so I have to be careful the day does not get away from me without progress. I look at my calendar the night before and set alarms just before every meeting or webinar I want to attend or prompts to leave for in person events. That way I can work without concern for the time. I do the most important things first things in the morning because that is when I am freshest, and it helps set up my team for their days work if they have answers to all their emails and messages from the day before. I do not go to bed until I have done at least one thing to move my financial goals forward. Big or small something has to happen each day to progress. 

Glad it was helpful!

Del is unique for sure! Thanks for listening!

1. Take the time to learn the area of investing you will focus on. Ask lots of questions and never stop asking questions even when you know a lot more. Getting educated is critical. Most people can not afford to learn from their mistakes in real estate. Find someone who has successfully done what you want to do the way you want to do it and follow their map.

2. Read every word of every document you sign every time. Do not get lazy or in a hurry or sub one to pressure or feel stupid or embarrassed. Do not assume anything, especially that lawyers and Realtors know what they are doing and got it right. Everyone makes mistakes and everyone thinks they know things and they are wrong. Documents should be close enough to regular English to understand. If not ask questions and do not sign until you get the answers. Verbal agreements are meaningless. If it is not in the contract it is not real. Have signed agreements with all contractors too or at least a “paper trail” of emails and or text messages that record the intent of the agreement. This is not fun but is a discipline to master if you want long term success. Lawsuits are no fun and drain your bank account and you happiness.

3. Start by building a team. Do not try to build you team as you go, deals move too quickly to be finding vendors on the fly. Be honest with everyone about who you are, your resources, and your goals. Be genuine. Be professional even when others are not. Stay calm , always. Pay your vendors for the work they have done and pay promptly so you will be at the top of their list if you need help. Once the price is negotiated and agreed to don’t try to go back and renegotiate unless something changes in the deal. A change in your personal finances is NOT a reason for a vendor to reduce their price. Most do not work on large margins. A win lose deal, even if you are the winner this time, is not a sustainable business strategy.

Finding a good hard money lender is critical to success. I would ask other investor around your area about this lender and others. 

How do they underwrite the property?

Do they require an appraisal or do they determine the value on their own? If they do it on their own I suggest you consider paying for an appraisal so you know what the ARV is likely to be. It is worth the money to get the valuation right. Then get that rehab done FAST. Otherwise the comps fall off or the world can change on you and you are stuck. Typically real estate values do not change quickly but one bad company can cause issues on a flip or refi.

Do they require draw inspections? How many and what do they cost? I do not mind paying for draw inspections. It gets a third party set of eyes on the property and helps keep contractors honest. You can do that on your own, but you need to do it. Is work progressing? Are the materials the same as agreed to in your scope of work and the signed contract? Are change orders documented and executed properly?

What documentation do they require for draw requests to pay your contractor and what is the delay time for payment? Or will you front the cost of rehab and get it back at the end? This is really important to know if your liquidity is low. You have to sync up your draw schedule with your contractors to your draw schedule requirements from your hard money lender.

Do they have a track record of closing on time and not backing out of deals ( some are undercapitalized and suddenly do not have the money to close).

What are the costs involved if you cannot sell or refi the property by the end of your hard money loan agreement? Will they provide an extension? What is the cost? How long will they extend? Some will extend for 1-6 months, some will increase the interest rate and/or charge an extension fee. Make sure you will not end up upside down if rehab is delayed ( city red tags can kill you)

Are there any backend costs? Some hard money lenders have low interest rates because they charge the rest on the back end. They consider it a plus but you have to calculate the full costs into your numbers up front.

Finally, if you are flipping. Don’t forget about holding costs:

Hard money interest and fees, yard maintenance, utilities, insurance (Make sure you have the right policy for rehab and an empty house - builders risk. If you get a regular policy and are cancelled the builders risk policy will be much higher mid rehab than at closing when you buy) and property taxes that are accruing, And cleaning if it sits for awhile while being marketed for sale or rent.

Good luck, hard money used wisely can increase your profit!

There are companies that are 1031 exchange specialists. Usually run by attorneys. There are several strategies for getting her out of the deal that they can assist with.

You might want to check out opportunities to buy in other states too.

I am from So Cal but moved out because of the restrictions on property owners and they are getting worse not better. Be sure to read state and local landlord tenant laws. Before you buy understand restrictions on rent increases even for a new owner, missing this can foil your rehab plans. Rent control and eviction moratoriums that some lawmakers in California are trying to make long term if not permanent can be a problem and reduce income. Also check on source of income rules that may require you to participate in housing programs and be subject to their inspections and required repairs even when tenant caused. Check on your ability to screen residents too.