All Forum Posts by: Ryan Pemberton

@Jeff Starkey

I'd like to do a buy and hold on all.  Even if I can structure it to break even for the first year or two, I'd be thrilled.  If I'd have to sell one to make it happen after I took possession, that would be fine, too.  I like that there are unfinished duplexes and triplexes in the deal. At the very least, I'd like to get those at a deep discount, finish the repairs, and make them great cash flowing properties.  Maybe I can wholesale the rest.  The possibilities are pretty endless and my lack of experience is TERRIFYING!  I'm calling the seller tomorrow to get all the information I can.  I'm also putting a call in to my real estate attorney tomorrow to start the process.  I have to take action immediately and lock this thing down.

There's always a chance that she'll be completely unreasonable and the whole thing will fall through.. I'm prepared for that but hopeful that's not the case.

@Franklin Romine

Thanks for input.  That's a great idea regarding payments and breaking the deals up.  I'll run that by my attorney.

 I want the whole lot of homes.  Just from my quick comps and google street views, they all look nice and in decent neighborhoods.  

I haven't talked to her about types of financing or about mortgages yet.  That conversation is coming. 

I can put money down but not much without borrowing, which I'm willing to do.  I'd rather buy them all for myself.  I still have a lot of evaluating to do but I wanted to reach out to BP to get some thoughts.  I've gotten a lot!  (This forum post double-posted so there's an identical thread with more info on it.  I have no idea how it double posted!)

 This wholesale pricing bit throws a lot of red flags.   I'd make some more calls and find another contractor. That's my opinion. 

@Blanchard J Ross

That's great advice!   I have only talked to her once on the phone and that was returning her initial phone call. I don't know about mortgages yet.  Once I know more, I'll update the thread. Thanks for the reply!  I hope I can make it work!

Anyone know why this posted twice?  Can I delete one?

I sent out some yellow letters a few months ago that I'm still getting calls on.  A woman I reached about one property has a 9 home portfolio that her late husband was managing. She's not interested in messing with the properties and wants to travel and enjoy her retirement.  I've gotten a list of properties from her and the homes are all great rentals.  Some are month to month because they've been rented for years, and a few are newly signed 1 year leases.  Some of them are duplex and triplex conversions with only one unit rented and rehab still needed on the other units. 

Roughly, the homes are worth around $60k each.  That's an average based on some speculation and recently sold comps.  Some $40k, some $80k, but averaging around $60k.  There are a lot of moving parts.  A lot.  She stated in her email that she's willing to sell on terms for "tax purposes."  

I have never dealt with a deal like this and don't even know where to begin trying to structure the deal.  

Any advice that can put me in the ballpark of a down payment proposal and/or what sort of terms I should entertain would be great!  I'm going to talk to my real estate lawyer next week but BP has more collective knowledge that is equally, if not more valuable.

I'm looking forward to the replies!  

Thanks in advance!

I sent out some yellow letters a few months ago that I'm still getting calls on.  A woman I reached about one property has a 9 home portfolio that her late husband was managing. She's not interested in messing with the properties and wants to travel and enjoy her retirement.  I've gotten a list of properties from her and the homes are all great rentals.  Some are month to month because they've been rented for years, and a few are newly signed 1 year leases.  Some of them are duplex and triplex conversions with only one unit rented and rehab still needed on the other units. 

Roughly, the homes are worth around $60k each.  That's an average based on some speculation and recently sold comps.  Some $40k, some $80k, but averaging around $60k.  There are a lot of moving parts.  A lot.  She stated in her email that she's willing to sell on terms for "tax purposes."  

I have never dealt with a deal like this and don't even know where to begin trying to structure the deal.  

Any advice that can put me in the ballpark of a down payment proposal and/or what sort of terms I should entertain would be great!  I'm going to talk to my real estate lawyer next week but BP has more collective knowledge that is equally, if not more valuable.

I'm looking forward to the replies!  

Thanks in advance!

 I agree.  Vetting the contractors is of monumental importance but defining expectations is equally crucial.  As long as everyone is on the same page and you both respect the definitive boundaries, you should be able to establish a strong, long lasting relationship.

@Daria B.

I wouldn't do the work.  I don't ask for upfront payment, per se.  I'm not profiting from the material cost.  The 10% is nominal and basically covers my time, fuel, and delivery of materials.  I've tried having the client provide materials and it seems they always get it wrong..which adds trips to Home Depot for nickel and dime purchases that KILL productivity. 

I guess if I went with them, it might work out but I don't want to waste my time while they try to talk me into 2" nails as opposed to 2-1/2" nails...or 1/2" drywall as opposed to 5/8" drywall...or digging through the $0.50 lumber bin trying to find a straight 2x4 to substitute a $2.50 fresh stud.  I go into the store, pick up materials, and leave the store.  I quote quality materials and if they want me to re-quote with thinner drywall or junk trim to save some money, so be it, but I'd rather be picking it up.  I've never tried that approach..

If someone is so stingy that they're not willing to front that cost, they're likely going to be a pain in the butt to work for.  I handle myself as a professional, I do professional work, and I expect professionalism from clients.  It's just how I do business.  It may not be the right way or the normal way, but it's what has worked for me and my clients.  

I'm not taking any new work right now because I'm shopping for a flip but that's been my approach in the past.

@Daria B.

I make a list of material, go online to a big box store, fill a shopping cart, add 10% to whatever that comes to and request that amount...to the penny.  Once I get that check, I deposit it into my business account.  Once the check clears, I buy materials and confirm the start date.  That 10% gives me a cushion in case I use more hardware than anticipated or mis-cut some lumber.  It works for me and has worked for my clients. 

AND it beats the heck out of previous jobs that I fronted materials on a handshake with someone that had no intention of paying me from the start.