All Forum Posts by: Scott Hollister

@Amanda Groover, you can find them on the MLS. There is a smaller buying pool for a owner occupied multi. For instance, my first investment was two single family houses on a deed. I lived in one with a roommate and rented the other. My goal was to never pay the mortgage because it is one of the most costly things in your life when you factor in all the interest.

I have never done direct mail but your goal with DM would be to find off market deals. I would research it more to see if its right for you. Take into account your experience and education. A first time home buyer, owner occupied multi is a great way to get your feet wet!

Welcome @Scott 

@Scott McMillanundefined

You sound eager for knowledge, keep it going! Just from reading your post, the fluctuations in the market got me nervous! ha. Im glad you stuck with it and negotiated to stay with the home. Most would've bailed on their promise.

• Lets start with your goal here? I would assume its to create wealth by positive cash flowing properties? 
• The tenants sound awesome, I would say keep it but it IS NOT an asset if it takes money from you each month.(Read Rich Dad Poor Dad) I know their is equity but it sounds like an alligator in the sense that you're feeding every month. 
• Thinking off my head, and I am just making suggestions. Do your research and pick what is best for you...
  1. You can hold it until that lease is up, raise it to market rent and it sounds like it cash flows? (Treat it like a business, I know the tenants are good but you also have a promise to pay back that note. Do what is best for you.)
  2. AND take out a HELOC or Line of Credit against property (Might be difficult to obtain HELOC on investment property, but not impossible from what I've read on the forums) That way you can use that money for a higher and better use!
  3. This way you now have an asset that is paying you, and you have access to your equity, which is currently getting a 0% return. 

OR...

1. You sell, pay the taxes, thank your lucky stars that you got out of a house that could've put you in the hole like most americans. My mentor always says, "if you're paying taxes thats not necessarily a bad thing, it means you're making money"
2. Now you can buy an investment that is closer to you on the east coast. 
3. Also, you can 1031 exchange into another property, be careful on the time constraints to find one. 

I would figure out what you want specifically. That will make it so much easier to decide what to do with your property. Once you narrow your focus and find your why, investing becomes easier. 

Best of luck and keep working hard! 

@Joshua Dorkin, 

Its still fresh in my mind! 

The most important, and IMO the most often overlooked on a first deal is knowledge and action. 

I believe you should arm yourself with books that are highly regarded by people on this site and be careful to not to pick up analysis paralysis. The naysayers will always have their opinions, often times it is the people closest to you. 

1. Grab a book. Learn, study, review.
2. Save some money, get Pre-approved, find an agent, farm the area you're familiar with. 
3. Search for FHA owner occupied Multi (2-4)
4. Learn first hand. (Experience is the best educator)

Just remember you CANNOT fail. Failure is a good thing, it shows you what isn't working so you can fix it. There are two things in life, success and lessons. No such thing as failure! 

Hello all,

I have a unique opportunity in my hometown. Its a great deal, good neighborhood, straightforward cosmetic flip. The property just posted last week and we didn't want it to go so I made an offer in my business LLC (Which already has a hard money buy and hold in it, until I refi out this spring)

Its looking like we are going to get it.

Purchase 110k

Rehab 25k

ARV 185k

Heres my issue with financing: 

• One of our partners is bringing cash (His mother at 10%) with rehab costs included 
• Does she just wire the money before closing? 
• Seeing how we all trust each other and its in my LLC, how do I transfer the property after we take ownership of it? I don't mind holding it in LLC but I am just worried come tax season and I want everyone protected.

I have never done private money and this deal popped up and couldn't pass on it. Ideally I would've liked to have done more homework beforehand. Thanks for the input!

Welcome @Brendan Clake,

Its awesome to see someone who has passion for real estate at such a young age. Keep plugging away!

1. Lets identify your goals: This will be your sail for the future. You don't want to start off in the wrong direction, even though there are multiple ways to find success in real estate. Lets find the best for you with your strengths. (What are your strengths?) Example: Handy, has time, eager to learn, etc.
   • Goal 1: Create positive cashflow through real estate investing
2. Possible Solutions (Brainstorm): There are many ways to get into real estate at a young age. If you have money I would partner with someone who has a experience. If you have neither, don't worry. Most don't when starting out. Just remember even the best investors started somewhere. 
   • Check out the biggerpockets store for some valuable education. @Brandon Turner gives you the BiggerPockets Ultimate Beginner's Guide to Real Estate Investing for FREE!
3. Once you have brainstormed all the choices, carefully choose your vehicle for positive cashflow and go ALL in and hold NOTHING back. I am talking about grit here, don't let anyone get in your head, including family and friends. If you truly believe you will find success then you can create it. You said it seems like a fantasy. After that you said the most important words in your life. With "hard work and dedication I can make it happen". Do me a favor, write that down on a piece of paper and post it somewhere where you can see it daily. (Use that to find success in all other aspects of your life as well: family, health & wellness, finances, education, spiritual, business, and community.  
   • You might choose single family homes from the MLS or bank owned foreclosures. Or maybe its a duplex/triplex/fourplex with a FHA loan!
   • Here in the US we have government loans with 3.5% down. Most people can agree that a low down payment loan with a duplex is a great entry into real estate investing. 
4. After ACTION you then evaluate your decisions and progress as you continue your growth. Just remember you already have all you need inside of you. Just keep plugging away and learning, education will lead to success. 

Hello @Vanessa 

@Vanessa Perez, 

1. What is your mothers goals? Does she just want to get rid of the house?
2. Are you sure it will be a complete teardown? Could you hire out the work yourself and flip the house at market value? (Just throwing out ideas)
3. If you're selling by owner, I believe you can do that on Zillow? Craigslist is a good source. 

Would this be a great investment for someone? Is there enough meat on the bone by the time someone puts in the work to bring it to market value?

My best advice would be to talk to your local investors. Bring your situation to the next meet up in your local area. Often times people are willing to help here on BP.

Best of luck, glad to see you're taking care of family! 

@Brian Terry,

Its great to hear success stories! Keep up the hard work! I find it important to note that you are listening to audio books and podcasts. (And you have GOALS) = success 

I am glad you're starting to be more active on the site. My current goal is to post at least once a day in a meaningful way. It makes it easier to stick to a goal when it is in small, achievable steps. 

Do you have a list of your favorite REI audiobooks?

@Justin Mikes Welcome! 

You are at the right place to gain education. I think the first thing that will help you on your journey is a review of your goals. This is where you will find your desires. Maybe its enough income to cover your paycheck? Maybe you want passive income of 5-10k a month from real estate? Maybe you're a hands off investor and might want to learn about multifamily investments? 

1. Identify desires and set SMART goals to achieve them. Here are some good books to help your education 
   1. (Getting Things Done book will help you organize your thoughts and work space)
   2. Slight Edge will help you realize that we all have the same 24 hours. Its what you do daily (action sets the successful and unsuccessful apart)
   3. Richest man in Babylon for your financial education is a great place to start. 
   4. Rich Dad Poor Dad: Great book that will give you the itch for Real Estate and investing. Also its important to know the difference between an asset and liability. 
   5. Real Estate: All education you will need can be found on the forums, however the books that are published from BP are great resources. J. Scott has two awesome books and @Brandon Turner books are clear and contain great knowledge as well. 

Best of luck and enjoy the process! 

P.S. Listen to the podcasts when you're in the car, one of the easiest ways to gain some knowledge! 

@Bill Gulley, thank you for the detailed response!

When you establish relationships with several lenders/banks. Does that mean obtaining funding that isn't institutional financing? (Portfolio lending? Do they keep it in house?)

I agree on the infinite, I just found out when applying for a loan. The 6 month reserves for investment properties and 2 months for primary is slowing me down for the next property. 

Once you max out secondary loan programs, (Institutional financing?) is there a limit to commercial? Or do they limit the LTV of each additional property?

@Bill Gulley, in terms of opportunity costs, is this the question we ask ourselves? "What is the most valuable thing I am giving up in exchange for this time or capital commitment?"

Buy and Hold: For instance, the limit of loans you're allowed in your own name? What do you mean by "your available LTVs will drop as inventory increases"?

Thanks for clarifying, I love the line "figures lie and liars figure"!

@Mark 

@Mark Stoneundefined, 

1. I haven't done a ARM before. I wonder if it would cash flow after the adjustment?
2. Check with your mortgage guy, there are reasons to move out sooner. I believe for job relocation, etc. Just make sure you don't break the law. 
3. Ya I'm with you on increasing the cash flow, PMI is just one of those things that gets me frustrated at an extra $240 a month. But at the same time I can appreciate getting a home for so little down. It's a give and take like most things in life!