All Forum Posts by: Teddy Smith

%6 response rate is amazing, OP. Work those deals and land them all!

Lastest "creative" way that I've been contacting leads is calling rent signs and asking if they're interested in selling. Works fairly well. Actually learned about it on here!

Have you called a couple other lenders? May want to consider working with a lender that's commissioned based instead of salaried. Bank lenders have been very hit or miss for me and tend to be salaried

Have you worked with a broker? He/she may be able to help you analyze the deal, obtain proper financing, etc.

What are the details of the property? Is it in a bad area. ROI sounds sky high. May want to make sure you're not investing in a warzone.

Very true, OP. You could also approximate by comparing a single family unit. Example: The cap-rate of a medium risk brick rancher is %8. If the multi family unit is also medium risk, plug in %8. If it's high risk go for %10. Low risk shoot for %6.

The fact that it's difficult to determine the cap-rate may make the deal even sweeter since it's difficult to price. In the end, you could also learn to use DCF, IRR, NPV, etc to determine the price, but unless it's a massive complex income approach should suffice.

Start with the "Income Approach" to evaluate properties.

In my case, I use  letters that I hand address. Inside is a simple black-and-white letter with my signature at the bottom.

1. First letter - Introduction "Hi! My name is Teddy Smith. I am mailing you because...."

2. Second Letter - Further Introduction of my services "I can sell your property without you coming back to Wilmington, NC"

3. Third Letter - Market stat update "In 2016, the average home price in Devon Park increased %13!"

Rinse and repeat.

My price per mail is around 50 cents. I buy around 1000 stamps and just send out to all absentee owners and start cold-calling.

It's taken me a couple months but this system provides the highest response (even better then high equity and "I have an investor"). I'm a broker so this may be different to a wholesaler, but nonethless should still work for an investor/wholesaler.

Someone who knows the numbers and can accurately gauge risk of a property. 

1. Many agents will steer people towards properties with high returns without informing them of the potential downsides.

2. You need an agent that can accurately dig up the numbers to check if returns shown are really as they appear. So many agents that pump up numbers.

3. If you are a bigger investor, you need an agent with the ability to find deals off market via coldcalling. 90% of agents won't call and will just search for stuff on the MLS. If you're planning on buying multiple properties thru me, I'll go that extra mile.

I encounter investors like this all the time. I just tell them:

1. I'm not searching for you. You find the properties and I'll write the offer.

2. You better have a proof of funds or a pre-approval.

3. If client sounds like a noob and/or is unreasonable, I will also refuse to work with them.

Don't go to court, OP. From what you just stated, the tenants will have a really strong case against you.

Just pay for the doctor bill, replace the cabinets, be helpful, and be sorry. 

About the insurance, I have no clue if they'd even cover that.... Can't weigh in. 

 Good point, John. Sometimes I gotta let my inner landlord die down and realize we all make mistakes!