All Forum Posts by: Jeff G.

@Erin Murtagh there is an large REIA that meets on Square Lake Rd in Troy. You can find out more about them here: http://www.michiganrealestateinvestors.com/. Since you're just getting started I'd suggest you go to a meetup and see if you like it. I've made a bunch of contacts from going to REIA's. Also, sometimes smaller REIA's start as threads right here on BP and then people just gather at the pub and "talk shop." You've got to start somewhere.

@Jahmar Childs welcome to BP and (seriously) thank you for your service to our country.

Because you're active duty military you have access to VA loans. These can be awesome for flips and rehabs. You should check out BP Podcast Episode 103 where Elizabeth Colegrove explains how she and her husband have built up an army of rental properties using just VA loans and creativity.

@Holly Prokop why do you ask? Did you just get burned by a tenant at lease renewal?

When renting I've never been asked to show proof of employment once I've signed the initial lease. If you're getting paid regularly and the tenant had a job when she started with the previous lease I'm not sure it matters.

@Tina Ferrier just start sending Yellow Letters. Make sure to send them to absentee owners / owners with 50% or greater equity. Anything less and it's unlikely to be a wholesale deal.

If you have a lull in your mailings (perhaps due to budget constraints) start cold-calling Craigslist. I got an excellent lead yesterday from doing this.

Yes, I've dragged my feet a few times. I have an extremely demanding day job (60-80 hr weeks are not uncommon) and I do this on the side too. This forces me to automate and prioritize. There is usually a lull in my mailings (which I don't like) but I have to catch up sometime.

Oh, and since you're new: welcome to BP.

@Randy Abernathy try Googling "Hard Money Lender [your area] VA." chances are you'll get several results.

Also, consider going to REIA groups and asking around.

Oh, and before I forget my manners: welcome to BP!

@Chris L. I think I need to object to the idea on philosophical grounds.

When you extract a late fee it's because the tenant has caused you legal injury because if their failure to pay on time. If you "discount the rent" for paying early, respectfully, it feels like you've transitioned from landlady to land-nanny.

Vacancy is a bigger threat to your bottom line than mild tardiness with respect to payment. I know some landlords that take a lesson from cell phone shops: they use inexpensive loss leaders to secure longer term contracts.

How this usually works:

Someone signs up for a lease with a term of 14 (or 18) months instead of the more typical 12 months. In exchange they're given a loss leader such as a 50" TV or an iPad for "free." The value is agreed upon contractually in a lease addendum and is usually more than the landlord paid e.g., a $250 TV with a contractually agreed upon "value" of $600. If the tenant breaks the lease the value in the addendum is added to any future collection attempt.

If done correctly, in the right area, this can decrease the amount of turnover and increase the speed with which you take on new tenants in the event of a vacancy. What do you think?

I second @Michael Noto get a copy of the bill. There are a few possibilities here:

• Bad insulation as @Sergio Garcia says. Also, I might suggest getting the furnace inspected. Why? Because certain failures can cause the furnace to burn more fuel than required. I personally had this happen to me once (partial furnace failure) where my unit wouldn't reach 60 degrees but I got a $300 dollar bill in the mail. Yeah, I was upset.
• If someone has moved into the home (e.g., a room mate) with a delinquent utility bill it's possible that their bill has been tacked on to the primary occupant's bill. It's an especially nasty way for some utilities to attempt to collect on utility debt. I imagine some states don't permit this kind of behavior.
• Check the back yard, the basement, and the attic as appropriate. It's always possible that you have a tenant that's into "indoor gardening" and I don't mean petunias. This could also explain the elevated utility bill.

Welcome to BP @Patrick Bellard 

It's nice to meet a fellow Michigander on this site. I sympathize with your predicament. Getting public records from public databases in MI can be painful and expensive in a nickle and dime sort of way. I seem to recall the record search in Genesee county to be especially hideously if I'm not mistaken.

Your best bet would be to go get a Real Quest Gold account. It can be had here: http://www.realquest.com/ for about $80/month as I recall. That may sound like a bit much (because it kind of is) but realize that that it pays for itself if you do more than about 40 property searches per month.

It works well for pulling up property records and simple owner and mailing address look-up. It's well trusted and can give you fairly good comps too, a lot of Appraisers swear by it.

Good luck.

Pass

@Jeorgia B. most rehabbers won't touch a deal unless they can profit an absolute minimum of $20,000. Further, you should be making $10,000 on the deal (more or less) yourself as well.

As a rule of thumb, even if the house just needs "lipstick" (negligible repairs and updates) that's a presumed $10,000 in rehab. Under the most ideal of conditions minimum amount of "meat" on a wholesale deal therefore is $40,000. I just don't see that reflected in your numbers.

A cash buyer is much better off waiting for the house to be sold off at a tax auction and potentially picking it up for much less than what the current owner owes. 

I used to get calls all the time from extremely motivated sellers with insufficient equity for me to do anything. Sure, theoretically I could have done a Subject-To deal or the like. But, I'm just not interested in a deal structure of that nature just yet. I quickly learned to scrub my leads for 50%-100% equity.

I hope this helps!

@Andrew Challenger 

I agree with @Victoria Winters it sounds like you need to get a clearer picture of how wholesaling works.

That Tom Krol guy I mentioned earlier (sorry Tom, I misspelled your last name in my previous post) has a "Bird Dog" academy online here: http://www.floridabirddogs.com/index.html

The site is intended for "bird dogs" (property scouts) but gives a nice 14,000 ft. view of what it is to be a wholesaler. More than one wholesaler in your area has gotten their start from this material. Learn the material and reach out to him. I'm not one of his students but I was inspired to take action because of a podcast series that he was in. He has a lot of bird dogs and has partnered on deals in the past per his comments in podcast interviews.