All Forum Posts by: Neal Collins

Don't go off the appraisal. Do your own due diligence and see how much similar houses are going for in the area both fixed up and in similar condition. Try to gauge what you would need to put into it. If this place is on the market then I would be very careful. If that couldn't make it work then how could you?...unless your idea is different from the other two peoples'.

Ohh okay sorry! I didn't understand the question. I would hardly consider FHA creative finance. You have so many options to get in the game it's not even funny. Just be happy you have a place to live! It all starts with finding a property owner that wants to sell and seeing if you can work something out that works for both of you. Best of luck! Don't forget to start planting seeds about that 107 unit if it's a mom and pop type of operation... That's a long game though.

So that's really up to you. Your Net Operating Income on the property is really what your left with after subtracting out expenses. That does not include debt service. So let's say my ROI for the year is $30,000 but my Debt Service is $25,000, then my cash flow for the year is $5,000. With 12 months in a year that was for one unit then you're getting $417 per month. But if that is spread over 8 units, then that's only $52/month per door. That's a lot different. Then you need to factor in how much equity it takes to get that cash flow. If I sunk $500k into a place and only got back $50/month total then I'd be pretty upset.

Your goal is to buy the 107 unit property? Get cozy with the owners and try to involve them in the financing. After that make sure you can step your management game up and get those units performing so you can meet your debt service!

I'm not advocating either way because it depends if you're end game is appreciation or cash flow, but something to seriously consider is the tax free profit of up to $250,000 if single or $500,000 if married on a property you've lived in two of the last five years. That's a lot of spare change not having to go to the government if you sell now...

What's your debt service per annum look like? Then you'll truly be able to gauge what your netting each year/month.

I wish someone were throwing dental, vision, and 401's at me! You may be working for someone else but be sure to use that job to your advantage by leveraging your W2 into a nice loan package. 

Best of luck at the new job.

As others have mentioned it's nice to see how seriously you've taken goal setting and visioning. The most paramount piece of advice I would recommend is ensure ample time for due diligence. The riches are in the niches, and within each one of your goals there are niches upon niches (let's not forget the large, pink Jamaican elephant in the room!)

One thing about the areas that you're looking at is that there are some very strong, sophisticated players that you'll be going up against. They are capitalized and have active teams. There is a big difference from a 4 unit to a 50 unit in the world of finance, and you'd be surprised at the difference between financing a 4-plex to an 8-plex.

It's going to be a great ride for sure. Don't discount how important boots on the ground are to truly understand your target area(s), build your teams, and become familiar with the landscape. It'll be challenging to get going if your strategy will be to scour on-market listings from abroad. Leverage your condo sale but be sure to buy right! No need to trade out of one unit that is gaining equity and riding appreciation only to buy an overpriced asset in it's place.

If you are ever in the Portland area let me know. I was working abroad in the same sector before moving to the West Coast. It'd be great to hear about your work. Cheers!

This Tuesday sounds great. Thanks for the heads up Sid!

With the construction background you've got a nice resume so to speak for private money. Like our business coach says, "You're 20 calls away from securing all the funds you need." Get your phone, have your numbers and pitch ready to go, and make some calls. You are offering people a great investment vehicle that they cannot get through the stock market or savings accounts. Where else can they get a a nice rate of return for their money that is secured by a trust deed on the property? Name them as a lost payee on the insurance policy and tell them that even if the place burns down they are still protected.

If you don't know anyone who can lend you the money, then work with your title company to pull a list of names of the top investors in the area that are paying cash for places. Reach out to them and pitch the deal. Even if you have to assign the contract, you're at least following through on an agreement that you are liable for (assuming you have the right to assign it). I'm sure you have a nice network of GC friends, they would be a good place to look for money or could at least point you to people who have money to get the deal done. 

Good luck shopping your money. You can get this done!