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All Forum Posts by: Jim Stardust

Jim Stardust has started 6 posts and replied 114 times.

Post: So When the FBI Raids the Bank That Has the REO?

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

FDIC usually takes assets over and sells them to other institutions.

Post: FL SFH Inventory Being Held Back

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

I want to echo what James and others are saying, banks have wised up and now they're releasing their inventories in a controlled fashion and pricing them very aggressively to move fast so they can mark them to market on their books and move on. I don't know if it's an issue of reserves as much as it is an issue of them having already taken the writedown on their books and if the property sells, the take the difference and drop it to their bottom line. In any case, if you are watching REO's, you got move fast and be very nimble. I can also confirm from a broker in my area in Ohio which is not as hard hit as Florida that they're receiving multiple full price offers the instant the property goes on the MLS. I think it's a combination of investors looking for deals and banks aggressively pricing properties to move, not much is sitting around for more than few days.

Post: Renting a house across the street from my residence?

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

House across the street from my personal residence is on sale and I can get a heck of a deal on it, I'm thinking about buying it and either sitting on it for a while until the market improves a bit around here or possibly rent it to a company that brings a lot of executives to our town, mostly on a temporary 12-24 months basis. I wouldn't have hesitated a bit if it wasn't literally across the street, I can think of few advantages but I'm not so sure it's such a great idea after talking to few people about it...I'd like the perspectives of BP member and see if anyone been in a similar situation?

Post: Water Heaters

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

I've heard that time frame as a general rule but it all depends on the condition of the water heater, how much it was used over the years, and how well it was maintained? You can hire someone to do a "tune-up" and they run around $75 but it's really worth it, IMO. I believe it has to do with energy consumption and efficiency, the older heaters require more maintenance and consume more energy, in theory, but again it all depends on your unit, the manufacturer, and how it was maintained.

I agree with Jon, there are certain codes that one must follow when installing one of those, a licensed plumber is recommended but I've watched them replace mine and it didn't look like a big deal, if you can cut and weld pipes, it's pretty straightforward. The other option, if you decide to replace it, is to buy the heater on your own and price the installation, sometimes you save several hundred dollars.

Post: What do you put the most weight on when screening tenants?

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

Credit issues can often be explained, especially in this economy so credit score and such shouldn't receive the same weight as say employment and rental history. If you've seen her current residence and she kept it well, that should tell you how she'll likely treat your property. I agree with Bienes, as long as you go by pre-written criterion, you should be fine.

Take the time to find the best match, you primary goal is to find a tenant that will pay on time (solid employment prospect and history), and will treat your property right (references from previous landlords). Don't fall for the "moral" character, I've had people come in telling about their church's work and how they teach Sunday school and it turned out they were selling meth out of their previous place. What kind of place is it, what about location, how much rent are you asking?

Post: Should I use all of my Cash or use Bank's Money

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

I've done both - used my own money and used the bank's, and for me personally (it might be different for you), I found out that I was much more motivated to get things done/fixed/sold when I was using the bank's money. There's also a sense of security you will have if you keep your money in your savings. BTW, how secure are your jobs? How long will the wife plan on working, what happens if there's a sudden change in your life plans? You got to keep that emergency fund for whatever life throws at you, the interest fees will be negligible if you do things right, heck, if you stop eating out a couple of times a month, that will cover your interest fees. Use the bank's money, it's never been cheaper to borrow, keep your money!

Good luck!

Post: RE GURU, Armando Montelongo and probably others...

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59
Originally posted by Cory Smith:
This is why they sell "Education"
This is copied from inc's 500

The Armando Montelongo Company's business model

Provides instruction on real estate "flipping"purchasing properties on the cheap, rehabbing them, and reselling them for profit. Armando Montelongo is the star of A&E's Flip This House.
Statistics
3-year growth:8161%
2010 Revenue:$47.1 million
2007 Revenue:$570,338
Employees:125
Employee growth:121
Founded:2006
Industry:? Education
Industry rank:#1

So they went from making around $500K between the two couples (him and his brother and their wives) to making close to $40 million a year? If the 121 persons they hired (probably mostly low level associates) are making $50-$100K on average, that's like $10 million, add a bit for rent, printing, and offices and such, then the Montelongos are probably pocketing close to $35 million a year. That's where the real money is made, how many flips will he have to do to generate that kind of income? It's like franchising, once you develop a successful formula for a business, most of the money is generated by selling or licensing that formula.

Only the "extremely" motivated can benefit from these programs and use the resources to get a good ROI, most people might as well throw the money down the toilet. But then again, this can be also said about those spending over $100K to get a worthless college education. It's what you make of what you're trying to achieve and accomplish and how hard you're willing to work. The problem with these "GURU" programs, and I believe it's intentional, is they try to make it seem easy and that the only missing piece is the information they're providing, they don't mention anything about the type of work ethic you need to have, the type of personality you need to be in this business, the type of interpersonal skills you must have, etc...If you get the information in that book/DVD/seminar then you're golden, and that's the biggest fallacy. I don't blame these GURU's for offering knowledge or a product, it's just dishonest and disingenuous when they make people believe that all that's needed is the missing "knowledge" or "product" piece that they're offering.

To relate a personal story, I went to a workshop (not in real estate) and the person giving the workshop would personally interview the attendees who expressed interest in joining his network. He would reject people that he didn't feel have the aptitude or traits he was looking for, he cared about his "brand" and he knew it wasn't for everyone. When I see Armando or others doing the same thing, I'll know they're legit...

Post: Talking with Local Banks...

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

Well, how did it go?

Post: How to Write Off Maintenance expenses on my properties

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

You can't deduct maintenance expenses unless you can prove it adds value to the property, those expenses are aimed to keep your properties in good operating condition. They can, however, be recouped through depreciation.

Post: Which one would you rather have?

Jim StardustPosted
  • Real Estate Investor
  • Cincinnati, OH
  • Posts 119
  • Votes 59

It sounds like most here agree, that the evolution in securing a good life in REI is to start at the bottom and work your way to option 1 (mailbox money), or am I reading it wrong?

Wholesale to have some cash to invest in some flips so you can buy some cash-generating rental properties! The question is, and I've seen posed in varying ways, what do you do with all the cash flow, surely you not going to invest it in stocks or gold, right? ;-)