All Forum Posts by: Shaun Vembutty

My understanding is that it would be very hard to get started in NYC with that kind of capital. You would have to travel a few hours out to get into lower priced properties. But even with that, 20K liquid does  not get you too far. My suggestion would be to partner with someone that can bring more capital into the equation. The credit score is great but honestly does not add to much value in the flipping business since loans are mostly private money and are based on the asset/project itself. The score will help but only to an extent.

I was in the same position around 8 years ago and started off by buying rentals. The first question you need to ask yourself is 'do you want to get into real estate investing and keep doing it over the long term or are you just trying to deploy the 500k and be done with it. 500k seems like a lot of money but you can run through it very fast and if you don't have a long term plan, you could be stuck without a plan of action. Just start networking with as many seasoned investors as possible. Every investor has their own niche and talking to them will let you decide which strategy suits your mindset and goals. To start with, just focus on education. Deals are going to be there, so there is no rush.

A standard operating agreement is automatically drafted for you with basic provisions when you open a legal entity with online services such as LegalZoom. If the structure of the LLC is unique or if you need additional language included, you might want to hire an attorney and open it through him/her instead.

There are dozens of ways to structure the fund and returns. I would suggest talking to your first batch of potential investors and get a feel for what they are looking for. Be careful with promising distributions especially early on in the life-cycle of the fund. With a PPM offering, the only thing you have working for you is your reputation and track record and one slip-up could mean the end of this venture. I would also suggest you don't start a large fund to begin with. You could start with something around the $2 - $5 mil range, get your feet wet, deliver results, build your track record so that when you go out the second time for a larger offering you can promise lower returns and you would still have investors willing to take you up on it. A lot of people think that if they raised the capital, that is the end of the road. However, that is only the beginning and where the work starts is in making sure all of that capital is deployed and making a return for you and your investors. As mentioned in the previous posts, don't skimp on attorney's fees in preparing the Offering Memorandum and Subscription Agreements. It is well worth it.

Cash-out refi loans are going to be less than 20 years on investment properties. Don't try to time the market - it is a futile exercise. Just take the equity and see if you can get into a couple of single family rentals. Regardless of how hot the market is, you can always find deals.

All,

There is a house for sale in my area by the bank, where I know it is a great deal but the agent says it is being 'Marketed While Occupied' and they are not going to guarantee occupancy and also issue a disclaimer that property might be subject to tenant protection laws etc. How does this happen? If I were to buy this property, what are my options?

@Varinder Kumar

As long as you stay within the setbacks and easements, the sq footage you are trying to do based on the lot size is pretty reasonable, so it should be doable.

I am a spec and custom home builder in Houston. Are you looking to sell the land or develop it yourself? Either way, let me know and we can talk.