All Forum Posts by: Masa Don

HUD is good and bad, deals have become very marketed and therefore brokers have taken advantage of the idea of "forclousures" being a great deal even if they are not, so uneducated folks are buying not so good forclousures at inflated prices. The benefit to Hud is that they do a quick walk through the property for you so you can bid away with out haveing to go to the property, this is nice, also a few postings have mentioned that they have lost their earnest money, I too have lost my earnest money however after the fist time I learned my mistake and all you have to do to back out of a contract and get your money back is expose somehting they did not in thier walk through, this happened to me on my last hud deal, I found a water leak they did not mention stopped the deal and got my money back. HUD is a great back burner

Explain these "pocket listings"

I am seeing a recuring feature out of a lot of these posts, by the way thank you all for your responces they have been extremely helpfull! It seems as though the real deals are not the realtor deals but the groud level search em' up deals that you do not need a realtor for.

That is a great advice, can a wholesaler sell the property to me or will I have to use a realtor?

The issue I am running into, I know a good deal, I have put bids on places that would be a good deal for the last eight months, I have won about six bids but all have had issues (deferred maintenance) that put them out of the deal realm. I LOVE working on my places to get them prepped for rent, tiling, plumbing ext. So now I have sat for eight months since my last deal putting about a bid in a week with NO prevail! I did this on my last deal and paid too much, (still cash flow) but I could have done better. I am not finding any 50% 2% deals, however my own numbers work a 1% deal pretty well I am shooting for 2% willing to go 1% ( on certain units) How do you keep you cool and not pull the trigger on an almost deal?! I’m going crazy here!

MLS, Realtors, Secret Society?!

I work in the investment world, managing retirement plans. It is extremely important to me that I am on the same side of the table as my client. This my real estate friends is not possible in this world of real estate investing. I have been investing in real estate for just under five years, and every purchase I make pains me to pay the realtor fees when I find the house or muli-unit property, I submit the purchase price, and I do my market research. Now don’t get me wrong I love my realtor she is wonderful, she has even cut me a flat rate deal so that she IS on the same side of the table as me. However because she is so good, I do not feel comfortable asking her to find me deals because she has MUCH larger clients, she is extremely busy working amazing deals for HUGE investors and has simply put me under her wing. Thus I had to begin looking for another realtor, hypothetical situation . . .

Our relationship in the real estate business starts as follows.

Realtor “What are you looking for?â€

Me “Looking for a property that matches this equation bla bla blaâ€

Realtor “I found you a couple of great deals!!!â€

Me Excited! “Where?! Lets do it!â€

Realtor shows me three properties that I have passed over for the last four months.

Me “These don’t fit my equationâ€

Realtor “Your equation must be flawed because these are great propertiesâ€

The issue at hand I wanted a certain type of property and have never been shown that property, the only realtor that I have found that is awesome is too busy because she IS good! Then when a property is finally found; realtors are paid on a percentage of the house, which is fine for sellers, but terrible for buyers, what motivation does a buyers agent have to negotiate a price down, they get paid less!!!! That is WRONG! Oh and look at Mortgage brokers as well, the higher they can get you qualified the more they get paid as well because they are paid on a percentage as well! Seriously people this is NOT ok, we wonder why we ended up with a HUGE housing burst, the only people working for the buyer is . . . . . NO ONE!!!!! I would like to know ONE good reason why MLS is not public domain!?! Also I would like to know why Leagalzoom.com or something like it does not have the right to create and sell LEGAL documents that would solidify a real estate sale. (may be they do if they do let me know! ïŠ) WHY MUST YOU USE A REALTOR?! Or a Real Estate Lawyer?

Your humbled real estate investor.

PNW, I work in the biz and I AGREE!!!! Not to say there isn't a place for stocks in a portfolio but there is also a place for real estate, generally people lack the portion of real estate invesments in their portfolio to diverisfy. In three years you'll wish you had more money in stocks, but in 10 you'll be happy you have your money in real estate, then a decade after that you'll wish it were in commodities. . . ect. You get the point I belive the key is to use it all wisely, don't put all your eggs in one basket no matter what basket that may be.

My LOC is variable, and I agree that it will sky rocket in 11, may be even sooner, at least the second the market picks back up it will!

Mike I would agree with you, these times are a little scarry though when a property can drop in value 20% in a quarter what is equity?

Jon once again amazing post, your information is invaluable!

To everyone: I read on another post that a gentleman bought a place got an LOC maxed the LOC to buy a dozen other properties and is now in the hole with the LOC. What is your take on LOCs? I have a decent sized LOC (at least I think it is decent sized) and thinking about using it to purchase buy and hold rental properties, using it for the down payment or cash purchase depending on the value of the property, one year later refinancing (hopefully pull equal money out I put in) and repeat. What do you feel about using an LOC to leverage even further in this manner?

Wow does this story hit home! So . . . as real estate investors "we" are arguing against overleveraging . . . however one of the MAIN purposes and advantages of real estate investing is leverage, thus where is the thin line? An example was given of 65% I am only three years into this real estate investing thing however that seems like a great way to miss out on some great deals! At the same point 100% leverage sounds like a suicide pill! Where do you guys think the magic leverage is?

On that same note, I have a property that I purchased for 130, they say is valued at 230 (YEA RIGHT!!!!) I took a LOC for 84K. I am planning on using that 84K for my next unit, granted I don't think in these times you can even get to the point of 100% leveraged, but if the market continues to plummet then it sure is possible. What would your advice be regarding the LOC, only use for emergencies? Use for downpayement on the next couple places? Use only as fix up costs? Close it out (I would never do this but you never know)? What do you think?