All Forum Posts by: Chuck Webb

Get prequalified with a HM lender first.

If you are starting out and doing single-family first, do the challenge.  That extra 10k can help you get into a property.  Right now, you'll be coming more out of pocket.  Cash flow is becoming less and less as interests rates rise.  I did the PIG...was not worth the 20k.

Not if you want to have tenants, and not with a 99% survival rate.  They statistically have a greater chance of being in a fatal car wreck right after they leave from viewing your property.

Protest your taxes every year.  Pass the increase to the tenant.

Im not seeing rates for primary resident loans going too far above 4.0.  I hope they don’t.  I had to put down a 5% deposit down on a new build that probably will not be ready until August (This makes me a little nervous). I will probably lock in 3 months out.   There is the option to buy down points.  All loans are negotiable however.  
As far as investment loans go, If you can make the property cash flow within your criteria, then by all means move foward.

I do to generate a more complete scope of work beyond the obvious repairs I would need to do.  I try to fix everything within reason so I can deal less with calls from tenants later on.  If the property price does not leave me enough room to minimize my out-of-pocket, then I just walk away and let someone else deal with the future headache.  BTW I pay 450 for a thorough inspection...it can save you money in the long run.

 It's called Quest...more local to Tx.  https://app.lifestylesquest.co...

I practiced analyzing properties for over 3 years before I purchased my first property. I was saving up capital and getting my finances in order (credit score, debt-to-income ratio etc.) & building professional relationships. I don't flip...yes you can make good money...but it does not build wealth. In the real world, it takes capital to build wealth. I started with a hard-earned 150k in reserves. After 2 1/2 years, I'm at 750k in equity with my buy and holds (using the BRRR strategy). That's with just six homes. I was patient and just waited for the right deals to come along. Comps are everything. I pay 70 bucks a month to have access to real comps listed on the MLS and I buy wholesale. I want to see the data with my own eyes. When you start a project, you have to see the end before you begin. Buy right from the beginning and you will stay in the game. I make my living as an architect...this is just my retirement gig (I don't do the 401k thing). All my rental income goes back into the RE cycle. Good luck flipping if you want to make a living doing that....but it's not investing...that's retail.

Never pay subs upfront unless you are giving them money for materials. Even then, I pay for the materials then have them do a pickup.  Only pay them when the job is done and you have inspected their work.  Paying them by the hour is a recipe for disaster.  I always pay my subs right after they finish the job.  It keeps them coming back to me when I have another job.  So many investors out their "stiff" their subs in order squeeze a little more equity out of the deal.  Trust me, word gets around, and before you know it you will be unable to find anyone to work for you unless you pay in full...then they will rip you off.

Right now I would budget anywhere from 55 to 65/sf.  This would be a total gut.  New everything.  This is if you GC the job yourself.  Add 20%+ to that, if you are hiring a GC.