All Forum Posts by: Curt Smith

Yes costar is the king of commercial data and is insanely expensive for the small operator.   But I know folks who have actually bought deals off loopnet.com.  Yes lots of bad deals, but make offers based on YOUR metrics, math, cap rate goals.  Often you'll offer 1/2 of the ask.  LOL.  Always include proof of funds, and ability to close the whole deal with your offer!!   

Propstream.com is great (good enough) for SFR. I just checked its filters AND data set. For my GA county I tested, Gwinnett, I clicked the MF 5+ doors, and in this couinty there's 724 leads. FWIW Propstream is $99/mo. And comes with 10k leads pulled / mo (I believe). Propstream (like several other similar products) you can filter on age, value. You can't filter on roof type (to eliminate flat roofs). But there's pictures and age (newer then 1975 ish) can filter out bad things like clay/iron sewer, galvanized plumbing, flat roofs just on age. BUT older are more likely to be wanted to be sold by older owners... Sooo.

Re MF/commercial.  Please PLEASE pay for education in MF/commercial deal analysis and most importantly proper contract construction (often >>35 pages) and due dilligence steps.  IE a 16 door to 50 door due dilligence will easily cost you $5k out of pocket MINIMUM.  This is sunk costs even if you back out.   New folks make bad offers, or don't do dilligence thoroughly and end up with bad properties they struggle to get cash flowing;   old and soon collapsed sewer line, flat roofs (stay away from flat roofs),  old plumbing,  landlord paid water,  old applicances,  old R22 ACs,,,  etc etc.   The post closing maint can sink the ship, tenants move out, you find they aren't paying (in reality) and have to struggle to evict in a post CDC eviction moratorium where the courts are still slow / reluctant to evict (unless you are in a landlord friendly state/county).

Search in youtube for multifamily coaches.  I always reco folks take specialized deal types (MF, self storage, hotel etc) expert education.   I can't find my notes on the best MF trainer I've heard of.   Search BP commercial for multi family trainer/coach.  And youtube.  That $2k (includes travel and hotel stay) is well worth it.  

REI is a knowledge business so also focus on knowledge AND your network of other MF buyers. Check meetup.org for local REI groups to join. REIAs are where old timers hang.

Best of luck, curt

 Hi Kaus,  I'm just another user, around 3 yrs.  I just use the very basic features of uploading a list of addresses, paying for skip tracing, around 10cent ea, and created an 8 mo, 8x, touch campaign and just turn it loose and never touch it again.  Then answer the replies I get back from the 4 rented phone numbers.  I don't use RVM, not sure it works today, I ignore messages,  nore email.  If you train up reireply has a ton of features.   

BUT I agree they are not a hand holding org.  reireply was built for personal use by a nationwide wholesaler and then eventually opened it up for subscription users so their purpose is not so much to cater to new folks, but their own use.  It works, you just need to dig in and start using it.

There are a few other SMS tools.  IMHO none are "hand holding" you need to unfortunately spend a lot of time figuring out how to get each tool to work.

If you have questions, their process is that you create a trouble ticket.   Best of luck to all.

I have a free training doc that comes with all doc examples and process to close and post-close a sub-to. I like helping investors not screw up the best deal in REI buy and hold!!!

There's solutions for everything but you need to be educated AND have the docs to get each step done correctly.

#1 banks do NOT want real estate! They are happy with getting paid, so pay them. I set up auto pay with the bank using my POA to manage the mortgage. Banks are used to POAs and estate managers taking over. Its language they are used to "hi I'm the manager for the estate of Mr Smith, I have a POA I need to send in to be on file. Where do I send it?" ...

#2 get a 2nd POA to manage the insurance policy. Contact the agent, say I'm the new estate manager and need to cancel. Problem is the unused portion refund check will be made out to the borrower/seller. No solution other then to mail them a surprise "thank you" check. If you are on good terms offer to split it. Same problem with annual escrow re-balancing and overages. Those checks are in the borrowers name. But mailed to ME since I'm the manager via the POA and I change the mailing address for the loan. I enjoy ad-hoc mailing $$$ to the seller, who sold due to hard times etc. They can use the funds. Worst case I've had, the borrower has died. I toss those checks. I've tried to get the bank escrow dept to cancel the check and apply to next year. Some success some not.

#3, forgot to answer the OP's qquestion;  yes get NEW insurance for a rental with your favorite carrier, named insured is how you hold title.  I strongly suggest you get my doc and close in a land trust.  The named insured is the landtrust.  AND Additional party is the seller same name as is on the canceled home owners policy.   Lender is the same bank etc.  Then have your agent fax the new policy to the bank right after closing.  This triggers the insurance refund issue mentioned above..   

It all works smoothly.  Only a very very rare small local bank with one location and not very smart raise any flags.  The major lenders all know land trusts and POAs and "I'm the new estate manager" no problems.

Connect with me, then PM, I'll send my training doc.

Yes but my training which I share if folks connect and PM me, has the buyer get a POA to manage the loan and another POA to manage the insurance policy (changing it to a rental policy). I've never had any problem invoking my rights as the attorney in fact over the mortgage. I buy into a land trust with the beneficiary as the borrower/seller THEN at closing we sign an assignmeht of beneficial interests to my LLC. I can always show doc to the lender a valid and satisfying to a lender the title structure and manager (me).

All these far fetched things to worry about are distractions; folks (new folks).   Please please get my sub to training doc to learn the proper way to close a sub to and more / as importantly what to do post closing the more important steps!! 

Do deals, don't worry, all of these theoreticals never happen, or have solutions. IE you bought such a good deal, you can sell retail just by listing with FSBO broker on MLS for $500 and have it sold in a few mo.

Best of luck, curt

Hi Zack, in general get yourself educated by a creative teacher and that education with come with contracts and the even more important,  how to use the contracts and talk to the seller.   Creative is an area where it can't be deligated to a 2nd party to handle.  You need to be the expert in the 1st person.  Its not surprising when you learn what Attorneys are ACTUALLY good for they can not help with the creative paperwork.  You (I) bring all the docs to closing and the Attorney is an expensive notary,,, beside pulling title and passing through a title policy.

Which brings up;  very few closing attorneys will do subject to/ lease option,  contract for deed closings.   They don't understand them.   Most important tip #1;  Join the local REIAs!!!  Find them in meetup.org.   Find the old timers, the REIAs to get referred investor friendly closing Attorneys.  These guys / gals will still NOT do the subject to paper work, but they understand it and will allow you to bring docs to closing the seller signs...   POAs, trusts, affidavits etc etc.

Go to youtube and search creative deals,  subject to,  negoticating with sellers.   I've bought all the teachers training, its all pretty good.  Joe McCall,  Joe Crump etc are very good.

I've written a how too close a subject to pdf I give away becasue I hate to see good deals screwed up with insufficent paper work.   Connect, then PM me I'll give you a training doc with paper work examples and negoticating tips.

Best to all, curt

@Rick Baggenstoss  "eviction service"   thats useful to hear, thanks for mentioning that "systematizing" aspect that padsplit.com's system provides.  Who is this service?   For others, this is the Atlanta area.

For others;  today eviction, the magistrate court judges etc has not gotten back to what the process was pre covid.  I hear of judges turning more tenant friendly etc.   I've done a few evictions myself as the landlord but today I would use an eviction service who knows the judges and the "code phrases'" that work in court today...  ;(

Hi Travis,  I'm in Atlanta the home town of padsplit's start.  Am in a group where members might be running in the range of 100 doors (x 3-5 rooms each) of padsplit.  I don't have any padsplit though for reasons I'll tell.

You will be mostly wrong assuming padsplit is lower effort, hours / week managing vs airbnb.   Your time running an active business of padsplit (or DIY rent by the room) varies per week. Some weeks no effort, others when you need to "put out a not working out tenant" more work.   The early days padsplits operations process tried to run uusing hotel tenancy laws, that has fallen by the wayside due to magistrate court/fitting into a standard eviction process via magistrate court.  So tenants that don';t work out can be stuck in a room for 2 months while the slow eviction process works through.   Airbnb you just call the police and they are gone.

Padsplit simililarily to airbnb, site selction is very important. Only a few houses will work for either; parking, isolation from neighbors etc. IE its a very bad idea to attempt rent by the room with close neighbors, or in a nicer HOA neighborhood where tenants are seen walking streets to the bus/mass transit. Depending on your location, more folks will apply for renting by the room if you are on/near mass transit. Padsplit can still work in the burbs, but you need lots of parking and space to the neighbors.

Padsplit is only up and running their francise in the bigger cities.  Otherwise you are DIY running a rooming house and its alot of work screening and managing the 2am fights, tenants leaving their trash in the kitchen iratating the other tenants.

Its all doable, just the actual amount of hands on is more then you might think, even if padsplit is in your area and is willing to take your house into their system.   

Risks;  zoning / code enforcement for running a rooming house, more then the county limits on un-related adults in a rental.  In Atlanta area its 3 unrelated adults.  Code enforcement in Atlanta area is lower since the locale's realize that padsplit is providing low income housing so code enforcement follows neighbor complaints or repeated police visits.

Your experience maybe smooth and easy, and I hope it is!!   Same with Airbnb can be smooth and easy.  Both need systemitization!!!!  

What my friends say is the $$ advantage over 12 mo term rent is around 3x higher net.   There is up front costs like dividing the living room into 2 more bedrooms etc plus the simplier furnishing.   Remote control and locable thermostates,  water leak detetors and main cut offs.   The multi door padsplit operators have alot of home automation they remote control and monitor including cameras on the front door (not interior), remote managed bedroom door locks, front door lock etc etc.

I won't get into either rent by the room or airbnb!  We prioritize OUR lifestyle and free time over income.   I only own nicer rentals with fenced back yards and rent to families with dogs.  I never hear from those folks.  :)

Best to all,  curt

All very interesting IRR etc math here. And the OP topic is nice theory too. What intesests me in commenting is to simplify for the OP and others my tactics;

- Yes we sold for cash or on notes to other local investors remote houses that I could not make perform at distance.  IE my business model of rent to own to top tenant/buyers in some lower income areas didn't work.  Where a local face to face investor could make straight rent work if they where face to face.  So those deals I gladly sold off and most now are paying me principal and interest without the hassel of tenants or toilets.   A note is not the best possibile solution, its a middlee ground in that you give up appreciation for convenience (no hassel) and _some_ income for your risk taking buying the place.   Given this middle grouind I still like selling off dogs on notes to other investors vs a cash sale since a true dog is not a likely fix up and sell to retaiil for max $$ there's something wrong with the house that a local investor needs to take it over.  But I agree if the dog could be fixdd up and sold to a retail owner that is a good solution to raiise cash.  But but read below, we NEVER sell for cash.  We sell dogs on notes or cash out REFI...

We did sell off the dogs like the OP, but it was NOT on a 5 yr rotation, which in 2019-beyond the tight inventory just doesn't allow one to so easily buy better deals as the OP's theory suggests.  Its VERY VERY hard to buy performing replacments.  At least in my hot area, Chattanooga and Atlanta.

- Yes we didn't let equity sit forever dragging down your return, we cash out REFI!!!   :)   We love the doors we currently own.  Most of our tenenats are >5 yr stays so I would never sell a house out from under these wonderful renters.  Its their home!

- We believe in buying good houses in decent neighborhoods and keep them forever. Cash out REFI when equity >= 50%. The math of cash out REFI needs alot of equity for the lenders LTV max net you decent cash out.

- Just buy good houses that match the needs of your target tenent type.  To read up on what this statement means, go to my BP profilee, read the paper I linked off my 1st paragraph, how to buy a bullet proof portfolio.   It will change your views about what is the asset in buy and hold.

Best to all, curt

I was new once, we all where.  I remember when I was comparing tools.  Little did I know its not so much the tool (marketing) its the lead list where the 10x even 20x differential in results are in.  IE I suggest folks study now to filter / buy top leads for your deal type.  For SMS its the skip traced / phone numbers you use to SMS to.   

IE if you are wanting to wholesale which I don;t reco today, its too hard, you want a list of high equity owners BUT BUT the value is in figuring out a source of stress, a reason why the owner is on the virge of wanting to sell.  Just a list of high equity will waste your marketing time, they will allbe happy owners.   You need to target recent or currently in bankruptcy, has liens on the prop,  just had a medical event, or is late on some payment 30-60=90 days late.  Just got divorced etc etc.   You need to learn to be an expert in some source of stress at finding, filtering for (a data source tool like propstream.com) or buying from a data vender who is good.  BTW so many data sources sell crap leads.   Worse everyone under the sun with a CC bought those same leads.    

If I had $10 for marketing, I would spend $9 on the lead list and $1 on some tool to do something with those leads.   After I got good at pulling leads that work, I can switch that ratio and spend $3 on leads and $7 on sending something to those leads;  post cards, sms, rvm, cold calling.   Knowing what I know, at first you should spend your time and $$ on the leads.  Its all about quality leads, not the tool.

This analogy is similar here;   a really good contractor can give a better rsult with crapy materials vs a crapy contractor with top materials.   :) :) :)

Best to all, curt

That makes sense Jake, about every product out there including cheerios does this type of review harvesting.  ;(  

I can only say I'm a long time reireply user, in its simplest mode.  Drip out SMS to a big list of stressed (in theory) owners.  Dripping maybe 200/day across 5 rented ($1/mo) phone lines.   I know the sms are being delivered, or some number, I get replies.   Telling me to f-off.  Geeze!   I got one deal early on.  The lack of good leads I don't attribute to this tool, but my list and that still folks have good enough jobs to afford to pay their mortgage.   I keep paying to sms an upload fresh lists on "faith" that sooner or later the faithful bird will get a worm.   

I don't see any reason to bash this tool.  It works, its reasonably priced.  Go use some other SMS tool.   Comments on a thread about a tool by folks who NEVER used the tool is just ... not sure of the word, but its not useful for anyone.

Go join the reireply 2 or 3 facebook groups to find more actual users.  Yes one company facebook group and another by a wholesaler using this tool.  Maybe a 3rd grouip.  There is support and users out there.  One the topic of support, the support tickets I've created got answered by the next day.

Marketing;  its 98% in the quality of your lists!!!  Don't blame poor results on some tool.  IE buy a bad list that is full of happy home owners, yes all you'll get back are f-off's and "stop"'s.   Go study "rei data"!!  You need to become a data expert to know how to pull lists.  I use propstream.com for that.  Looked at a bunch of touting tools and tossed them for propstream.com.   Yet another $99/mo...  :( :( :(   I have at least $500/mo in tool subs.  Listen folks, the Gurus saying wholesaling is a low $$$ deal type are wrong (lieing).  You'll spend typically 30% of your net on marketing costs.   $10k assignment, yoiu'll have spent at least (AT LEAST)  $3k on the marketing.

Best of luck to all, curt