All Forum Posts by: Rafael Mercedes

Good afternoon! Do you mind sending me that repair list you mentioned in your comment? 

@Rafael Mercedes  Back in '07-'08, foreclosures were on every street and they were a hot strategy, along with short sales.  Now, however, foreclosures are far and few between and not nearly as fat a market as they were back during the crash.

I deal with scenarios like this often. If a seller is stuck on their price then I need to get favorable terms. I just bought 3 properties for full retail a couple of weeks ago. There were tenant issues and the seller was getting screwed by his property management company. So, I told him I would pay full retail only if I can cash flow the properties by having a payment no more than 45% of current rents ( not projected rents) and at zero percent interest. Each house needed some improvements, so I offered zero down as my cash would be improving the units and his security of the promissory note/mortgage.

He accepted as this is the 1st time in 7 years that he's actually putting money in his pocket each month.

BTW, I resold each individual property on terms using a wrap around mortgage (which the seller is aware of and approved) at 7% interest to other landlords. I make a spread and they do the work.

I'm currently structuring a laundromat with 3 apartments above it the same way. We are paying about 100k over retail to lock in a 2% rate amortized for 30 years which gives the seller what they want and a monthly payment that allows us to cash flow.

There's certainly a way to buy these 4 properties if you both are flexible on terms.

30 years ago I closed on my first real estate deal. It was a foreclosure, owned by the Resolution Trust Corporation. The RTC was a federal agency created in 1989 to resolve the Savings and Loan Crisis of the 1980s, which resulted in approximately one-third of all US savings and loans failing.
Armed with just enough information to be a danger to myself, I made an offer and much to my surprise it was accepted. But there was a problem. . .the RTC wanted a $19,000 down payment. Nineteen thousand dollars?! I had nineteen dollars. LOL But I did have a credit card with a $20K cash advance available. Off to my bank I went and I cashed out. (Word of advice: don’t ever do this!). Signed the papers, mailed in my money, and I was now the proud owner-to-be. . .but there were unexpected obstacles.
The foreclosed owner remained in the property. Despite multiple on site visits and mailed letters he wasn’t responding. I persisted and much to my surprise one day the door opened a crack and thus began a multi month journey through this man’s personal hell that eventually led to a $30,000 profit.
He owned a local Jamaican bakery that was failing; his marriage was ending and his soon-to-be-ex moved out with their 5 year old daughter; and now he had lost his house. I became his crying shoulder and confidant, stopping by once a week or so with beers and a sandwich. He quickly trusted me enough to let me walk around and check out the house. At one point I noticed a fist sized hole in the wall at about ankle height. When I asked about it, Desmond replied, “I was arguing with my wife, got angry, fired off a round from my shotgun.” Message to self: Desmond has a temper and a shotgun. This friendship lasted several months until he was ready to move on. With the help of two local kids I loaded his personal goods into a rented truck, said goodbye, and thus began phase two of my entry into real estate.
Marketing for a buyer was predominantly done in the print media. Yes, horror of horrors, there was no internet or social media! I forget how long it took, two months perhaps, but I found my buyer. Now, it was a matter of the winding, tedious journey of going from contract to closing. At that time in New York it was about a four month process. Paperwork, lawyers, and bureaucrats, oh my! But we eventually reached the finish line and when we did, when all was said and done, somehow I made a $30,000 profit. I was thrilled, to say the least, and thinking I was now the smartest guy in the room, I jumped into another deal, another foreclosure, but this one had a very different outcome. But that's a story for another day which I will post up soon.

Hi everyone!

I am a 24-year-old business owner in FL and I've been looking to get started with investing for two years now. I have around 300k saved for real estate investment purposes. I've learned SO much from reading BP forums, attending boot camps and also personal research, but am still feeling a bit stuck on where to start. For a while, my plan was STRs in the South Florida market, but I've recently taken a huge interest in section 8 investing and have been learning a lot about it. I'm thinking of starting with conventional loans to secure 20% down payments and then eventually shifting to hard money lending. To the seasoned investors out there, what would your first move be if you were in my shoes? Thoughts on starting out with section 8? Super thankful for any and all advice. Thank you (: