All Forum Posts by: Ed Brancheau

Hey Frank,

It sounds like you've got an interesting opportunity on your hands! Buying an existing rental package with Section 8 tenants can indeed provide stable income, but as you mentioned, there can be some complexities. Since it's your first deal and you're out of state, due diligence is key.

Here are a few suggestions:
1. Research the local Section 8 program thoroughly, including their payment history and any potential changes in policies.
2. Get a detailed inspection done to assess the condition of the properties.
3. Look into the rental agreements and make sure you understand the terms.
4. Consider property management options, especially since you're out of state.

Remember, every real estate deal has its risks and rewards. With careful planning and research, you can make an informed decision. Good luck!

To find accredited passive investors for RV parks, there are two ways:

The Fast Way: work with other companies and split the profit. You'll probably get the deal done faster, learn a lot, and build relationships.

Friends of mine have worked with Wellings Capital which focuses on self-storage, mobile home parks, and RV parks. And I've heard great things about Happy Camper Capital and HTR Investors.

Now, the other way might make you more money on this one deal but would likely take much longer: Find individual investors and pitch them.

A few places I'd check are real estate crowdfunding platforms like RealtyMogul.

Obviously local real estate investment groups are great. You could possibly set up a real estate syndication to pool resources.

That's where I would start!

Yeah, I completely forgot about that. I used an FHA loan as a first time home buyer to house hack my first property, a triplex here in San Diego. God, that was like another lifetime ago.

Definitely go that route if you have already, Natasha!

Sure, Kearsten!

I've found that skip tracing for returned letters can be quite effective, especially for land deals because those often get forgotten. Personally, I use BatchLeads and DealMachine (I used to D4D but now I just use it for my bird dogs.) When it comes to other types of lists, you might want to explore probate lists, tax delinquent lists (especially during the first two weeks of November), code violation lists (hack: use the fee amounts to filter the best deals), and absentee owner lists.

In terms of marketing to homeowners, I've had success with direct mail, online ads (Google, Facebook and Youtube), and occasionally door-knocking when I've got nothing better to do. For newbies like you, I'd suggest Zach Ginn's D4D sticky note method.

Basically, buy a bunch of sticky notes and write a simple message, "Hey, this is Kearsten, and I have some questions about your house. Give me a call at 555-555-5555. Thanks!"

Zach recommends writing the notes by hand but I found that so tedious that I had 1000 of them printed, in my own handwriting, at Staples for like $50. This method works very well especially when you combine it with follow up letters using a system like DealMachine. But it will still work well if you don't have the money for a DM subscription.

Keep up the good work, and feel free to reach out if you have more questions. You're doing great!

Hey Natasha,

That's a great question! DSCR loans can vary when it comes to down payment requirements, and it often depends on the lender and your unique financial situation. To get a more accurate answer, consider reaching out to some local lenders or a mortgage broker. They can give you the lowdown on the DSCR loan options available and discuss potential down payment alternatives that might suit your situation.

Wishing you all the best with your first-time home purchase in Baltimore!

I totally get your situation. It's essential to compensate your local real estate agent fairly for their service. In a similar setup, I've found that offering a flat fee per showing can be a reasonable arrangement. However, it often depends on the local market norms. You might want to check with other investors in the Nashville area to see what's typical.

Also, consider any additional tasks or responsibilities they might be handling, like coordinating with prospective tenants or providing feedback. That could factor into the compensation as well.

Hope this helps! Good luck with your rentals in Nashville.

We own rentals in Nashville but live out of state. We do all of the marketing, tenant screening, property management ourselves but have a local real estate agent we use just to show the properties when we have a vacancy. We're trying to figure out fair compensation for this person. Any thoughts, experiences?

Yeah, that's pretty normal because when you start an LLC, you're creating an entity and that entity has no track record or income.

Actually, the US Supreme Court declared corporations are people. So, basically, your newly formed LLC is a baby. Would you let a baby buy a house?

I don't have the actual steps you need to take so you should talk to a real estate attorney to make sure that you follow all of the proper steps but this is a normal process.

And once your LLC is older, has income, and has proven reliable -- just like a person -- it'll be able to buy properties without it having to pass through you first.

There are 3% loans for first-time home buyers through the FHA and USDA, and there are 0% down loans through the VA. Depending on the county, FHA loans can be used for properties up to a certain value. They can even be used for multi-family homes in which you live.

That's why many first-time investors start with "house hacking."

They either rent out a portion of their house, rent out an ADU -- or, as I did, they live in the ADU and rent out the house, or buy a multi-family property and live in one of the units.

Regarding the BRRRR method, you don't necessarily need to come up with 20% down. Seller financing is an option. You just haven't talked to enough landlords. There are many tired landlords that feel like they want to sell but are afraid of getting hit with a huge tax bill, so they don't even try to sell the place. But when you explain how they can sell their property and avoid the huge taxes by becoming the bank and offering seller financing to you, they jump at the chance.

There are thousands of people on Bigger Pockets that have done just this so don't say it's not possible. It is possible when you learn how.

Also, the Rehab and Refinance steps are very important in BRRRR. You're Rehabbing the place to increase the property's rent and value. Then in 6-12 months, you pull out whatever equity you can. By this time, this can be between 10-20% of the value, which generally equates to 50-60% of what you put in, effectively reducing your down payment by 50%.

And assuming that you bought a property in an area that is appreciating in value, you can refinance every 6-12 months. Good areas can appreciate by 5% or more every year, which means you can constantly pull out 5% more. So, even if you have to put 20% down on a $100,000 house that appreciates at 5% a year, you'll be able to pull all of the money you put in over four years.

One thing I had to get through my thick skull was the fact that most investors never want to pay off properties for several reasons. But mainly, they can put their money to work elsewhere.

Finally, my best piece of advice is to be humble and have an open mind. Be sure to ask questions -- do you realize you didn't even ask a question -- instead of making assumptions. And understand that every investor was seriously confused about things similar to what you believe right now.

Also, we've all been there before with something similar. For me two years, I couldn't figure out "Subject to" deals until someone explained it to me simply, and it just clicked in my head. Now I'm consistently setting up "Subject to" deals.

Stay Awesome!

I invest all over the country including land in Shasta County and Northern California so I use a nationwide title company, First American Title Company. They have offices all over the country. And I don't think there's much advantage anymore to having a local title company because everything can be done electronically.

Here are some other respected, nationwide companies that I know people use:

Chicago Title Company: I actually used them when I bought my first house and the mortgage company I worked with 15 years ago also used them.

Fidelity National Title Company

Stewart Title Company

You're not talking about the same type of wholesaling. This forum is meant for wholesaling real estate, not other types of products. While they share the same name, they're very different animals.