All Forum Posts by: Edwin K.

@Denise Evans 

Is the best person to learn about Tax Deed Investing  in Alabama. She offer classes in Birmingham about the subject. I took one of classes and learned a lot. Here is a link to her website. Trust me if you are serious it is worth the price. 

Hey, the best way to learn is to jump in. Just like riding a bike for the first time you will get some scrapes and bruises. I got mines on my first deal but best part about it is I started and learned. You ran the numbers and they work(check)

1. Now go view it. You decide what "a good neighborhood is". Don't let anyone else decide that for you. I look in areas where some people on BiggerPockets will say it's not "good" but to me there's nothing wrong with the area. I grew up in areas that was deemed bad by certain people but in reality it's not. Heck I'm currently house hacking in a C area and I'm enjoying it. 
2. After you view it get a good and I mean good inspector. The one thing I learned from my first deal is picking a good inspector. Make sure the inspector have good reviews online and ask him/her to send a sample of how their inspection sheet look like. No sense in paying an inspector and you can't read their inspection sheet. 
3. If you have time get a contractor to bid on the issues the inspector found. 
4. After step 1 and 2 and 3 run the numbers again with the new information you have gained. Renegotiate the price if you need too. If the numbers still work move forward. 
5. Ask the owner for copies of the lease and all other paperwork on the tenants. Read the leases carefully find all the clauses for ending the lease, find the lease terms, rules, and so on
6. Now close on it.  

You got this... I believe in you. 

Are these vacant/abandoned properties or For Sale by Owner properties? If they are on the MLS just get a real estate agent.

To answer in a more serious way. No one can 100% predict if a value of a property will go up. Some investors bank on the value of a property going up if there's development aka gentrification going on near the property but that's still very risky. It's risky because no one can guess where that imaginary appreciation line will stop and your property may be two blocks away from that line. Banking on appreciation is gambling. You should only go after properties where the numbers are working in the current market. 

Disclaimer I am not an attorney.

From what I was told you have to honor their lease if there's no clause saying you can break the lease on sale of the property. Read the lease carefully to see what the clauses are. Some leases have a clause that allows you and the tenant to mutually agree to terminate the lease. Check to see if the leases are on month to month. If so you can terminate the lease given 30 days notice. Once again it's all about what is in the lease. I will advise you to get an attorney to read over the leases. The last thing you want is to get sued for breaking the Alabama Landlord and Tenant Code.  

@Garrett Diegel I love that slogan "Money is nothing but choices. The more you have the more choices you have."

My "why" is I want to control my life and time. I'm tired corporation telling me how I can spend my time. They tell me when I have to come in to work, when to eat lunch, how long I can eat lunch, when I can leave, how long I can be on vacation, how long I can be sick, etc. I'm just tired of. I have been working for corporate america since I was 16 and now I'm 27. I don't see how people do it until they are in there 60s.  

It really depends on your finances. If you can afford 20%-30% down in your market then go LLC because it can offer better protection for you personal assets against lawsuits when combined with good insurance and healthy separation in finances. If you can't afford a large down payments then put the properties under you personal name. As long as you have good insurance you will be okay during a lawsuit. There's no right or wrong hence the great divide on this topic.

Just to give an update I decided to walk away from the deal because the duplex needed a lot of work I mean full gut and I didn't think it was worth the price he was selling it for. @Blair F. I disagree it's not like I had none of the closing I had majority of the closing cost. I like to find creative ways to make the deal work as long as the numbers work. 

Sup yall! I'm a new investor with one property under my belt. I have a fourplex I got for 150k in Tuscaloosa, AL and I'm living in one unit and renting out the other three. I'm saving $1000 a month from not paying rent. I'm saving the freed up money to get another property and do minor improvement to my property. 

Okay my situation. There's a duplex located next to my property and the owner wants to sell it to me for 60k, down from his original price of 70k. The duplex appraised for 105k so I would be buying into equity. He wants to sell it quick because he is retiring this year. He is renting the units out for $475 each which is cheap because my units rent out for $550 and we both have the same sq footage and number of bedrooms/baths. Here are the numbers:

• Appraised price: 105k
• Selling price: 60k
• Estimated closing: $15,920
• Rehab: unknown haven't gotten an inspection yet. Plan on fixing as I go since current tenants report no problems after talking to them
• Rent: $475(2 units) with current tenants. Can rent for $550 each
• Cashflow after expenses on $475 rent: $55 per unit
• Cashflow after gradual rent increases to $550: $97 per unit
• Cash and Cash return: 8.3% without rehab numbers 
• ROI: $237.4% without rehab numbers

I don't have $15,920. I have a personal loan of $9,841, of the $12,200 total loan, in my bank account from a failed unrelated business venture that I'm paying $200 a month for that I can use: 

Questions: 

1. Would it be smart to take out personal loan to help pay the purchase cost? I can cover the loan payment with my personal money but is it smart to tie up $200-$400 a month of my personal money for 5-7 years. This wouldn't affect the $1000 month I'm saving already. 
2. Is it smart to invest in the property based on future cashflow because currently the cashflow isn't the minimum $100 per door?

Thanks!