All Forum Posts by: Scott Michael

 @Jay Hinrichs I've had many agents lie to me as well, this is not strictly a wholesaler problem. And by the way, the new wholesaling regulations in Oregon also include regulations against predatory realtor practices.

Hi @Scott, 
I can answer your question. The reason that a lot of wholesalers don't get licensed, is that we want to stay focused on our business model, which is being expert marketers and negotiators, and finding inventory for investors. Getting licensed would require us to pay brokerage fees, have principal brokers that have veto-power over our deals, would open us up to liability for deals that we wholesale instead of list (as we are not acting in a fiduciary), not to mention there is the burden of additional paperwork and ongoing training. Sure we could squeeze out a few more bucks, but we would also complicate our lives. I like to keep things simple in my business, and I have no desire to represent buyers or sellers - that's a completely different skillset than wholesaling.

It is similar to asking why a doctor wouldn't also want to sell supplements - some would, in order to "better serve" their patients and create an additional revenue stream, and others would rather keep things simple.

@Scott Trench undefined

Definitely Mt Hood!

I was wondering how do you execute a deal, where two investors partner on a buy and hold, and one partner who is financiable brings a conventional mortgage. It seems to me I read about this strategy in Brandon Turner's Book Investing in Real Estate with Low and No Money Down. It's in the execution that I need clarity. Do the two partners put a JV agreement together, and then one person buys with conventional in his name, and then both partner's LLC's are added to title via a warranty deed and/or quit claim after the fact? My attorney says this is flirting with mortgage fraud. Definitely want to steer clear of that, so how does one execute this type of deal?

Thanks @Ned Carey that makes total sense!

I have one more question, something that is throwing me off is that I got a hard money loan with a rehab loan for $29,736. The rehab loan shows up in the Debit column, so along with the Sale Price of Property of $296k,000 and  all hard money fees and closing costs (all in the Debit column), the total Debits are $337,762.16. The total Credits of 1k earnest money and $266,536.000 are $267,536. So the difference between total debits and total credits was $70,226.16 and that was the amount Due From Buyer that I had to bring to the closing table. That is a long set up for my question, which is, it looks like the rehab loan is money that I had to come out of pocket with. If it was truly a loan, wouldn't it have been on the Credit side along with the loan to buy the property? It seems like they are loaning me money that I paid them when I bought it. I can post a picture of the settlement statement if that's helpful.

Thanks,

Scott

Hi everyone!

I'm a wholesaler who has gotten into flipping. I just flipped my second house and am trying to figure out how much money I made.

I have used a pro-forma profit projection spreadsheet provided to me by my hard-money lender which bases projection on purchase price, hard money origination fees, closing costs purchase and sale, rehab costs, realtor fees, and holding costs, and I have replaced the projected numbers with my actual numbers. This gives me a Profit of $61,898.55.

I then tried using the closing statements from when I bought it and when I sold it. The Due to Seller when I sold it was $148,042 and the Due From Buyer when I bought it which was $70,226, and the difference was $77,816, and then subtracted holding costs of $9,711, and get a resulting $68,105. I thought that the number should match the sale price minus purchase price and all costs method.

Wanted to see if someone can tell me why these might not match, and how I should calculate profits at the end of a flip.

Thank you!

Hi Guys and Gals,

I'm a wholesaler and new to Portland. I was wondering if there is a rule of thumb formula I can use to quickly estimate repair costs in this area, for example it costs a house flipper $X / sq ft to rehab a house, that would cover kitchens ,bathrooms, floors, paint, etc, of course barring any major repairs such as roof, foundation, etc. 

Thank you,

Scott

@Ariana JImenez, @Joe Homs is a great help to newer investors in OC. He also teaches free classes on wholesaling, flipping, and other topics. Take him out to lunch and he'll help get you started. 

I would like to purchase a rental property from a wholesaler using hard money, then after the seasoning period put it on an FHA loan at 3.5% down. Can I do this?

Thank you @Andre Crabb