All Forum Posts by: Sam Craven

any kind of marketing is so compliated that a broad question like that only indicates that you need to do some homework yourself first.  you CAN make some money doing direct mail just like any other form of marketing.  

high level to get you started on some better search terms:

• Find a motivated seller list of some kind (absentee, foreclosure, tax del)
• Put together what the letter will say (not nearly as important as the list or sending to that list CONSISTENTLY)
• send THOUSANDS of letters, cant get deals sending hundreds of letters anymore
• ANSWER THE PHONE
• LEARN TO MEET THE NEEDS OF THE CLIENT 

I spend well into the six figures on direct mail every year.  dont over complicate it, just do it.

If you dont have the budget to send thousands of letters, then take that list and cold call it.

find a partner man, best you can do.   Give them 50% for putting the money at risk.  Call local wholesalers and housebuyers and hopefully they have a good reputation so you wont get screwed.

In the future make sure you can perform on what you bid on.

portfolio lenders have 30yr am but are more expensive.

Most are 5-7 or 10 year balloon. 

the other part you should consider is asset protection an LLC provides. I dont usually make decisions based on fear but simply having one affords A LOT of tax savings and puts up a little wall so other people cant get after the other assets.

The banks are going to want both of you to sign and then its a non issue with them.  

Otherwise if you want the asset in your name, you will need to transfer the money into your account 3 months before you apply for the loan so they dont think its a gift.  Then that entire deal will on paper be 100% yours.  Next deal can be 100% his.

But i have to ask....why dont you guys want to get a LLC? Portfolio loans are easier to get and deals are still good at 25yr am and higher interest rates. Getting a fannie or freddie loan saves a marginal amount of money when you look at the life of the asset.

So its either jump through a lot of hoops to get you both lined up with freddie loans or go get a LLC drawn up and go to local banks for the portfolio loan. Neither one is wrong, but one is certainly easier and safer if the partnership sours.

This is great as it is seemingly a big issue but i only see one problem that needs to be solved!

By my eye it looks like you just need a better bank!

Time to go out and find a new preferred lender.  Dont be afraid to go the next town over or look for a national lender.  Find one that does it at a 25yr amortization and understands the business.  I know they exist and i bet there are some that are even a sponsor of this website.

You have come a long way, dont let something like a bank telling you no get in the way of your goal!  Go find another bank.

For instance: We built an investment fund and raised $2M based on the assumption that a bank would lend on a 25yr amortization on single family real estate at 70% LTV. Well when it came time to refinance those properties the banks all of a sudden changed their mind and only wanted to lend 15-20yr amortizations and 60% LTV. Well the numbers aren't great for our investors at those terms so we dropped those banks like a bad habit and found the ones that were willing to lend our our terms...and we did!

So get your sales hat on, go out there and find some better banks to make your dream happen.  trust me, they are out there.

I wholesale single family and syndicate single family portfolios.  What business do you have in Houston?

I have a wholesaling company that moves a large volume of properties to both buy and hold investors and flippers. This simultaneously gives us insight into both investors and sellers and because of the volume we do and reach in the Houston investor community we can gain insight quickly into buyer and seller psychology. I also own a small investment fund that is currently executing the BRRRR strategy at a high volume.

I can't speak much to the data of the national level. I only have access to our data and conversations to the Houston Market. 

Sellers:
Its really early on but we are getting a LOT more listed leads then usual the last 3 mo.  Properties sitting on the market longer then expected and sellers are frustrated.  Looking at the inventory in Houston though and while its up, its still a sellers market officially.  However houston has so many sub markets you can cross a street and go from a buyers to  a sellers market.

Buyers:

One thing we watch is our margin and the prices that investors want to pay for properties.  This rising interest rate environment for our buy and hold investors has had minimal downward pressure on prices we sell our properties at.  This tells us that most investors (myself and our fund included) are still bullish on cash flow properties in Houston.

Flippers have also had min downward pressure on prices.  We see the high end of the market only buying 65-70% deals but everything else in the 300k and below are selling in the 73-77% range.  hard money Lenders are nervous right now as well, appraisals have been coming in lower then usual as they look to protect their cash.

I guess im providing all of this information because i think you need to know your LOCAL market VERY well and kinda know what national forces may affect it.  Houston experienced its own slow down as oil prices dropped in 15-16.  Maybe that was enough of a tap on the brakes for this national slowdown to have a lesser effect on us.  Tough to say right now, just watching it day by day.  Still buying rentals, still selling flips in this sideways market

create your own motivated seller lists: foreclosure, driving for dollars and then skip trace those names.  best bang for the buck going right now.

create your own motivated seller lists: foreclosure, driving for dollars and then skip trace those names.  best bang for the buck going right now.

if you want to take it a step further just have the house certified dry.  Costs a few hundred bucks and transfers any mold liability to the guy that guaranteed it was dry!  We in houston have a lot of water experience lol....