All Forum Posts by: Matt H

no no no, stay away from that crap. Did you see the interest rates they charge? It's rediculous. Just go to a mortgage broker or lender of some sort. Or at worst use like eloan or something. They'll find you legit money with a competitive bank rate. like 5 to 8%. none of this stupid 25% crap.

Well why did you go read the report? Now you're gonna be haunted whenever you go into that room! And remember when you're sleeping at night, he's right there watching you in the shadows ready to take you with him to hell! He's comin to getcha!

In five years you likely will have to pay out the second. So first try to get the seller to go for another 1 to 5 years. If not, then refinance the building. If it's not enough then find you a new third party lender who does seconds, to put in the rest. Any mortgage broker can find you that. But if you need a new second chances are you will no longer need 20%. After refinancing the first you may only need 5 or 10%. And or perhaps be saving some of the cash flow you get over five years. That could also contribute. And there could be other sources to tap such as refinancing your home in five years to pull out some funds to cover it. Another good option might be to condo convert within five years. That way you could pull out "a lot" on top of the equity you have in. ie: on a 30 unit if you paid 35k per door when you bought. Then condo convert and sell off the units as is to investors or current tenants for say $70k, after costs chances are good you could come out with $30k net per door (x30 units) = $900k net. Depends on the laws in the area too and the quality and size of the units. But I'm just saying that once you have the building often there's lots of options.

Who's gonna know the difference. You have to be a bandit remember. That's what a bandit does to get his bandit signs.

another thing to do is look is small towns and cities. They ususally cash flow in these smaller centers. Big cities it's the opposite, ususul no cash flow at all in a big city.

Well I'm not saying it's impossible to make money in stocks. I'm just saying in general it's far risky. You have no control over what the business does, you're just along for the ride. And I'm sure all of those houses eventually bounced back. So the owners who had locked in mortgages for even five years probably didn't have higher mortgage payments for much of that time frame. And eventually now they're houses are worth far more than they paid, not to mention they probably have paid off the mortgages years ago. Unlike a stock which if it plumits could mean the company goes bankrupt. And you never see a dime of your money again. Yes I've tried the stock market too. I know you can make madd money, but you can also lose you principle. After trying a lot of other investmensts I know I'm never going to invest in anything but apartment buildings. There about the safest asset out there because regardless of the economy people always need a place to live. And if you want to make a fortune off one apartment building, all you have to do is condo convert it and you can pull out millions in net profit. How do you do that with a stock?

Ya but I know for a fact that if you look around enough you might find a house at 30% discount because it's vacant and the owner is several months behind on payments and they have to liquidate at any cost.

But apartment buildings are different. If you find a property that has tenants in it and the owner is charging what is about the going rate in your city, it's very unlikely that they will somehow be willing to reduce the price by 30%.

They have no need to because they an make they're mortgage payment each month and so they might drop the price a little, but to actually find a building that would go for that big of a discount is just not out there. And even if it is, it's not worth waiting around for. You'll wait forever to find that property.

On apartment buildings I know what cities and provinces they generally don't cash flow in, and I know what areas they do cash flow in. So I generally just look for the areas where there cash flowing, and if I find something and when i do the numbers if it appears to be generating decent revenue. And if it appears that other buildings in that area are generally for sale for about the same amount. And if that's the building I want, I offer list price almost every time.

Because my goal is to get a building that's got some cash decent cash flow and that meets certain objectives. And if it does all that why put in an offer that's even 5% below list. Because they might already have a list offer in hand from some other serious buyer. So if you go even 5% under then you stand a chance of losing the building. And if you go 30% below I guarantee you wont' buy anything.

Look just for fun try this. Find 10 apartment buildings in the area that you're looking to buy in. Just for fun send 10 letters of intent to each of them asking for a 30% discount. I'm curious to see if anyone actually even returns you call. Let me know what happens. Then you might do the same thing but offer list price and see how many return you call. Like I said before, on single family houses "yes" that is more likely. You go out and make 50 to 100 offers and you might just find 1 person who you can negotiate with. You might not get 30% off but maybe 20% which is still pretty good. But on apartments you can make all the offers in the world, and I guarantee that as long as the building is fully occupied which it should be if you're buying it, then you won't get any replies. You might get a reply on a vacant building, but why is it vacant? Chances are there a good reason for it. Such as it's been deemed unfit to live in and shut down. Or some other very serious reason that makes it very risky to pursue.

Like on the last 5 buildings I've bought I've offered list price on all of them. And I got all of them. 5 for 5. And all of them cash flow, all of them where listed at about the going rate out there, all of them were full up, so why not at least offer list price so that you can actually get them which is your objective. Because again your only 1 rent increase away from more cash flow. And when you factor in the money you make in mortgage paydown and appreciation you actually do quite well.

beekrock.....

I think you're a little confused. See when you got to buy a house to flip, you're not keeping it so that means you should try to find something below market value.

But when you buy a property to hold it's different. If it's got cash flow at the price they're offering then there's no way you'll ever get 30% discount. That's very rare. You might get 5% discount if you're lucky. What you need to do is factor in where you'll be in one, three and five years after a rent increase, mortgage paydown, and appreciation. Buying to hold is like getting married, you don't cheap out on the wedding, and you got to think long term.

Obviously if he rents or advocates renting then he's got a very low net worth, and probably knows very little about business in general. Besides if you buy a stock you have nothing. What you're buying is a piece of paper. It has very little security in it. If the stock plumits then what? At least with property You can't lose any money. Absolute worst case senario is that you break even. Also a bank won't lend to someone to buy stock, but they will lend in some cases up to 100% of a house purchase, why would a bank do that? Think about it because they're money is safe. Anyway stocks are okay for a tiny part of your portfoilo but I think it's a waste. Why buy a piece of paper. It's worthless.

Example:
Purchase price = 100k

Bank mortgage = 80k
Seller 2nd = 30k
Down payment = 0k
Cash you get back at the time of closing = 10k