All Forum Posts by: Matthew Martin

Hi @Account Closed. Southern California in general is pretty expensive and the cash flow is not going to be great if you use traditional financing and find your properties on the MLS. You have to use some type of marketing to find off market deals for a great price that you may be able to rehab and rent for a much better cash flow.

Thanks @Kerry Baird, and @Fe Kelly for your comments. I appreciate it. 

Hi @Steven St.Pierre. Thank you for your service as well! I used the VA loan for my first home (the one that is now being rented out). I could have used the remainder of my entitlement for my second home since I had about 200K left of entitlement, but it would have been a hassle and very expensive. The second funding fee in replacement of the PMI was comparatively higher (around 11K as opposed to 4.5K on the first loan). Additionally, I would have needed 20% down on the difference between the price of the new home and the remaining entitlement. My second home was 315K and I had a 200K VA loan then I would have to pay 20% down on the remainder which would have been 23K (20% of 115K). So all in I would have had to pay the 11K funding fee plus the 23K down payment. I would have been all in for 34K. The way I did it was a slightly higher interest rate, but I only put 15K down. And I knew I was going to immediately fix and refinance the second home. It has worked out nicely.

Decide what market you want to work in. This is the first step. It doesn't make sense to build a team and then look for the property because the effort you put into the team might be useless. What if you find a contractor and agent, but come to find out they are not an expert in your area where you finally decide to invest? Or what if they just don't travel that far to work? Find the area then become an expert on the demographics of the area. Once that is done you can start putting the pieces in place using local experts that can give you reliable advice. Hope that helps. Listen to the podcasts if you haven't yet. They're a great source of information from people who have done exactly what you're trying to do right now. Good luck.

I finally feel like it is time to start taking more action. I bought my first primary residence in December of 2012. Since then I have not been able to stop thinking about the possibilities of REI. I conducted a lot of research, listened to all the BP podcasts (most of them more than once), and hear one thing over and over.....Take Action! I wanted an investment property, but didn't have 20%. I thought to myself, "why not buy a new primary and make my current home my investment". It would turn out to the same result, but a different means. Besides, this would allow me to put little down on the new home allowing me to renovate it while i lived there instead of losing potential rent while the rehab took place. That is what I did. I paid 5% down on a slightly undervalued home on the MLS in Riverside (it was very ugly) and was able to avoid PMI with a slightly higher interest rate. It all worked out so far. Since then I tore the kitchen down to studs and redid everything by myself and it is beautiful. I also went through the entire house making it look beautiful with little touches. The best part is because of my financing I had to pay 4.25% interest rate on 30 yr fixed, but now I have 20% equity due to renovation and appreciation in one of the best neighborhoods in Riverside, and am in the works of refinancing back into a 3.6% interest rate on a traditional loan saving me about $100 per month. This will allow me to cash-flow better when I rent out the home in about a year (when i transfer due to military service).

Additionally, i have a stack of handwritten yellow letters sealed and stamped ready to be sent out this week (I feel handwritten are more likely to be opened and read and they're cheaper). I can't wait to see what happens with this. My only skepticism on the yellow letters is that I'm only here another year, and i know it takes some time to gain traction. However, once the traction is built I will have to move soon thereafter, but I feel like if I can get it going here and learn how the process works internally (with title companies, estimating rehab, finding buyers, etc) I can continue the process wherever I have to move to. I do have a competitive advantage in the fact that I was a Marine Recruiter for 3 years in one of the richest counties in the United States (Westchester, NY) selling one of the hardest things to "sell" to upper class families that have everything they could need in life. Long story short is that I know how to talk on the phone to indifferent customers, and am used to hearing the dreaded "no" or "I'm not interested". I was actually the recruiter of the year for my area (The entire tri-state area of New York from White Plains to Syracuse) in one of the most difficult regions to "sell" the marine corps. I love the fight that goes into the chase, and realize the battle that's in front of me. But like any good marine, I get excited by the thought of battle and don't run away. I can't wait to see what happens. 

I'm sorry this post is really long, but I feel like this will help me get more motivated, and will help keep me accountable to myself. Thanks for letting me share. 

Hi @Tom L.,

   Welcome. I have been on here for a while, but haven't been really active on BP. I just thought I'd take the advice of the podcasts and try to become more active on the forums. If you would like to talk about anything then feel free to message me. I am also in Riverside where I have one rental property and my primary residence that will be a rental in about a year when I move due to military service. Also, currently working with a friend on a multi-family deal. This is in the last three years. This info is only to let you know where I'm at in my career, so you can decide if I may be able to help you at all. Good luck. 

Matt

A small room is not difficult to do. My house was built in 1989 so i doubt there was asbestos.

1. Move everything out of the room (preferred) or into the middle of the room and throw plastic sheeting over it. (This prevents all the dust from getting on everything)

2. Get a pump sprayer from Home Depot for $12 and fill with warm water. Spray the ceiling. it doesn't require any chemicals. Water will eat through the old popcorn texture. 

4. Allow the water to soak in for about 10 minutes or so and attempt to scrape. If the texture doesn't come off easily then spray water again to allow it to soak.

5. Scrape the ceiling with a scraper until it is all removed.

6. You never know what you'll find underneath the texture. That's why they spray that texture because it hides all the nails, and imperfections in the ceiling, and it is quick, cheap, and easy solution for home builders.

7. Remove all imperfections... hammer nails all the way in, sand the rough spots, etc. Make sure the ceiling is nice and smooth.

8. Spray the new texture on with an air compressor and a wall texture kit. The kit is about 65$ at Home Depot. That doesn't include the air hose or compressor. This is just the spray gun and the hopper that holds the new texture. The texture is just joint compound that can be bought in a box and mixed with water in a 5 gallon bucket.

9. There are different types of texture patterns you can do once the new texture is sprayed on. It does take practice to make it look perfect. I do the knock down texture. This means you spray and wait about 10 minutes for the texture to dry up a bit and run over the texture with a smoothing tool that turns the drops into a smooth and clean texture. 

-Sorry for the long post. It is not very difficult to do, but does take skill to do well. However, in my case it paid off extremely well. I did one full house while i lived in it and rented it out. It just makes it look so clean and much more modern. I just moved into my next house and am working on the texture right now. It made sense for me to learn it because a 1500 sq. ft house can cost up to $3-4K to have someone do it for you. So I knew spending a total of about $600 for a good compressor and everything was a good investment since it is already saving up to $7K from a company to do it for me. Of course you can rent or borrow everything you will need. 

Keep in mind if you are only doing one small room and never plan on doing it again, then just hire someone and pay them to do it. This saves you all the trouble, and they can probably do it quicker, better, and save you some frustration. Definitely watch videos on you tube and refer to the list I provided if you want to learn for yourself. This post makes the task seem more daunting then it really is. Good luck.

Hey @Aaron Nguyen,

    I hope your real estate journey is off to the right start. I am not very experienced myself, but I do own my own home (bought in  Dec 2012) and plan on buying a new home in the next three months. I want to rent out my current residence and move into the new home to take advantage of the 5% down conventional loan, and the cash-flow my current residence will provide. With that said... I do understand this is a long-term game for the most part. I'm sure if you are serious about what you are doing, and put in the work you will be successful, but don't expect overnight millions. I am right there with you. Congrats on getting into UCR. My bro just graduated from there.  Great school. Good Luck!

Hey @Account Closed, 

     I hope you have had some luck finding the information you needed since your last post. I am just starting my first mailing campaign to begin wholesaling in Riverside, so I'm not experienced. With that said, many people seem to think wholesaling perfectly legal because you are not representing a buyer. So you should be able to wholesale without a realtors license. I am not a lawyer, nor do I have the experience, but that's my two cents. If I were you, and trying to get into a triplex or four-plex then it doesn't hurt to send out some mailers and see who bites. You may be able to find a deal for yourself to seller finance into and rent out the rest of the units. You will get experience marketing/wholesaling and may get a great deal without paying all the realtor fees or downpayment (depending on how you structure the deal). That sounds like a win to me. Good Luck!

Thanks everyone for your help. I spoke to my agent and she said that she would do all the letters for me free of charge. She wants a picture of my family and she will go to her brokerage to get the list of absentees in the area we want and send out a letter with the picture on it. We did get pre-approved for the conventional loan, but need 5% down.

I feel like it's at least worth a try to save any money on the house. Especially since the MLS listings she sent us don't have any houses that we are particularly fond of. We have time to wait for more listings to pop up, so why not send out the letters in the mean time and see who bites. Especially if she's paying for it.

Again. Thanks for the input everyone. It has given me more options to consider. Especially the multi-family option.