All Forum Posts by: Robert LaPrelle

My best results have come from working with a collection agency. They do that sort of thing professionally and save me a lot of stress and worry.

This SOUNDS like a good deal, but there is a lot that you're leaving out. First of all, what are you planning to do with this property? Do you want it as a rental, or do you plan to flip it? Is the owner listing it so low because it needs repairs(I assume the answer is yes, since you name an ARV)? If you plan on doing repairs, what are expecting to spend on repairs? How do you plan to finance the deal?

If I could find a property in my area for $55,000 with an established tenant paying $980/month I would jump on it, but not without knowing all of the numbers first.

First, I am so sorry that you have had to go through this. Evictions are stressful under any circumstances, and this sounds just awful!

I would STRONGLY recommend hiring a lawyer, especially since your tenant already has one. They will be able to represent you at court for the unimportant parts and keep your visits to a minimum (maybe even zero). I am inclined to think that you will get your house back (even if it might take a little time and cost a little money), but evictions usually have to be done in just the right way and a lawyer will be able to guide you through the process with a minimum of fuss.

Best of luck!

I would recommend local banks over national banks if you're having a hard time finding something. Local banks often have a little more flexibility and (if you're lucky) will get excited about reinvesting into the community.

Personally, I wouldn't come out and tell them that you are going to keep the security deposit. Doing so removes all of their motivation for returning the unit to you in good condition. Instead, I would tell them that you will deduct from the deposit for any time that the unit is left empty. That way, they have a financial incentive to help you get the unit rented again as soon as possible. They may even let you begin showing it BEFORE they move out. It is also worth noting that in some places, you are not allowed to charge them more of a penalty than what I describe above.

No matter what you do, I recommend a brief conversation with your lawyer so that you have a firm understanding of what you are allowed to do.

@Ray J. I think either way you go on that one would be a good idea. Personally, I would probably do both. Call up your cousin and offer to buy him lunch if he'll talk over the deal with you, then set up the closing at your lawyer's office with the paperwork drawn up by the lawyer. 

I think its more a matter of personal style than right or wrong. I like to keep my lawyer involved because sometimes he sees problems that I don't.

For your first question: there are a lot of different opinions on this. Mathematically you are usually better off consolidating under a single loan, but many people find it more emotionally satisfying to be able to clear out the debts one at a time. Dave Ramsey, for example, strongly recommends the latter strategy.

For your second question: I rarely find anyone ADVERTISING that they are willing to finance, but if you look for places that are "for sale by owner" they are more likely to work with you on financing in my experience. It never hurts to ask.

I would recommend using a lawyer, especially since this is your first time. You can do that kind of transaction with just a title company, but I think a lawyer is well worth the money your first time through. Good luck!

For one thing, investment (by definition) means you have to invest SOMETHING. That doesn't HAVE to mean money, but it usually does. The other route that you can go is to invest time and knowledge. Read everything on real-estate that you can get from your local library. Read everything on BP. Listen to the BP podcast. Go to local meet-ups. This will give you the tools you need to analyze a deal. Then, check local listings every day. Drive/walk around every day. Eventually, you will find a good deal. Then, you call up people you met at the meet-ups and find a partner.

Bottom line, the less money you put in, the more hustle you have to put in.

Good luck!

I agree that you need to have a plan for how to pay for large repairs etc when needed. I think that the monthly rate is intended as a way of making sure that your monthly cashflow will support replenishing that cash reserve after its been spent. Personally, I have access to easy financing through a line of credit on my family farm. This lets me take care of repairs etc without needing to keep a large cash reserve, which means that most of my money is invested at any given time. The downside of that strategy is that I needed to be VERY careful with my first few deals because I was, quite literally, betting the farm on each one. It also meant that we had to look around for a while before we found a lender who was willing to look at our individual situation without trying to slot us into a pre-existing category.