All Forum Posts by: Tyler Blackwell

Anybody use Dwolla as Josh Matthews suggested? Seems like there's a consensus thumbs up for erentpayment.com, but Dwolla only costs 25c per transaction. I guess you could build the $3 erentpayment fee into the rent and not worry about it, but it would save $33 per unit to use Dwolla if it works well.

Thanks for the automation suggestion, I think it's one I'll adopt immediately, and I LOVE the recurring idea and I think erentpayment has the option to build in a late payment automatically if the payment is made late.

Good stuff, biggerpockets :)

Matt,

The seller is trying to get rid of the land ASAP in order to feed other investment acquisitions, which he purports is the reason he'd like to sell without any contract inspections/contingencies. I said he'd prefer a quit-claim transaction, but he's willing to go through escrow if I feel it's necessary (it might be).

We don't have any Joshua trees up here Matt, so I guess that's one thing I don't have to worry about :)

Hey all,

An out-of-town individual has a 1.75 acre parcel near me listed on CL. He's an investor that bought the property at a tax foreclosure auction for very little money. After a couple years sitting on it and not listing it (who knows why...), he's looking to get rid of it at a price that would be low enough that another investor (me?) could buy and flip within a short time frame.

For easy, round numbers, we're taking a purchase price of $20k with a tax appraisal of $100k. Neighbor's 2 acre lot has been on the market for some time at $150k. I'm not really familiar with comparative market analysis as it pertains to raw land, but I would think this parcel is worth around $75k-110k based on what has sold in the area.

Given the bargain price and the fact that the seller hasn't put it on the market --why hasn't he if he could list it for retail price?--I want to do my research. We all know that motivated sellers exist, and he apparently bought the lot for a song, so it could be a very good buy. County records say wetlands, but says "0% unbuildable," and there is a home on the lot adjacent and two lots down. Water/sewer/power appear to be available, but is something I can research.

Any advice from an experienced land flipper? What should I look for/research in order to feel comfortable that the land is buildable and worth something close to tax evaluation price? Buyer doesn't want to put the property under contract and waste time with what could be lengthy inspections (another possible red flag?) and would like to quit-claim the property to save $$$.

Ready, go! :)

Hey Adrian! Welcome! And thanks, Brandon Turner, for suggesting the contact.

I definitely agree with your strategy to buy a small multi-family property and live in it for a little while. That gives you the possibility of a low down payment (as low as 3.5% FHA) and you'll have little to no mortgage--you may actually make money! It will also build your landlord experience as well. It's a no brainer.

I love talking real estate, so if you ever want to get together and chat, it sounds like we're pretty close!!

Hey Mark,

I did a deal like that last year, where I purchased a bank owned property at a discount with hard money (to snag a better deal) and then did some minor repairs and refinanced. The idea is to use the cash to get a good deal, capture some equity in the deal, and use less of my own money in the down payment. I hope to repeat this sequence soon! If you buy it right, there's a possibility your down payment liability will be low --or zero-- depending on the ARV of the property you're dealing with. You should be able to find a number of lenders that are willing to do this type of refi in the current market; I know of a few where I'm at in WA.

Hey Rich, I agree with Bill. If the guy is a realtor and owns rental property, he probably understands that his rents are possibly under market and that the area is improving. That doesn't mean he won't be receptive to an offer...though if he acquired the property for a killer price and it's cash flowing like a bugger, he'll either sell at a ballpark price(+/- a few %) or he won't.

So, I think option 2 is best. If he's game at that price range, get more info and adjust the price as necessary. Best of luck.

Surprised to see so many engineering degrees! I'm in the same boat with a BS and MS in Physics. I work full time as a clinical physicist in the field of radiation oncology and like to dabble in real estate in my free time.

Hi Amie! Welcome to BP. I'm a newbie too, but really love the site, the content, and the new Podcast. I find a lot of value in the wide range of expertise available to us at BP.

I'm also a Seattle-area investor -- in Olympia, WA. Nice to have a local connection :)

Rob K, taxes, insurance, and w/s/g are probably in the range of $300, so I really can't see this one working with rents at $1,000. I let the guy know that it wouldn't work for what he's asking (both price and interest) at the current rent rate. I think there may have been $100 at the end of every month to sock away for any repairs or to clean up messes, but that's pretty tight. Too tight it turns out.

I'm going to keep looking for deals!

Thanks for the advice fellas.

Brandon Turner, thanks for the comments and the add...I'll be in contact with you and maybe we can work some deals in Grays Harbor! Actually, are there any cash buyers out there?

I tend to agree with you on the balloon payment as well. It would be scary to have invested so much in the deal and after 5 years the property doesn't appraise well enough to refi without a substantial down payment.

Tom S., I may bug you later for more advice, but you're right, he does want interest. Do you typically amortize your interest much like a bank would do? I feel like that would be a poor way to build equity right off the bat, since most of the payment to the seller would be interest, but what has been your experience?

My purchase price idea was more like $135k-140k, but instead of paying interest on a month basis and to reduce prinipal, I was thinking of bumping the purchase price and asking for 0% interest.

I'm very green in this area of seller financing, so I'm very happy to have the seasoned veteran comments :) Thanks guys!