All Forum Posts by: Tim Wittenborn

Hello BP!

Today I gave a showing to a couple in Seattle who are moving here to Chicagoland.  We used Skype.  They both are very nice and the room they were sitting in looked clean.  They love the townhouse and are interested in moving in on January 1st.  They are currently coordinating their move times.

They are moving because the guy got a better job out here.  He assured me that his job is already lined up.  I'm planning on asking for a letter of intent from his employer to confirm that he will have income when he arrives.  Credit scores are both 700+ and background and eviction checks came back clean.  Everything else checks out.

Is there anything else I should be worried about in this situation?  The have confirmed that they are non smokers and that they have one dog (which I'll be getting a pet fee for).  The lease will be very clear that only they are allowed to live in the property with their one dog and that smoking is not allowed.  I have not met them in person.

Would you sign a lease with someone you hadn't met in the flesh?  Any guidance would be greatly appreciated!

Thanks in advance,

Tim W

Thanks for the quick response!

We are going to add the second bathroom and do some other cosmetic work over the next two months, probably list early January and hope to get a tenant in by February 1st.  After doing some more market analysis, the second bathroom will add around 175 per month in cash flow.  Over 5 years of renting, we'll be looking at potentially 10k, which will way more than pay off the bathroom.

Excellent, thanks for responding and clearing that up for me!

Tim W

Hey BP,

Couple questions on our new property that have come up:

1.  There is plenty of room next to the original bathroom to make a second full bath off the master bedroom turning it into a very nice master suite.  This is something that we are DEFINITELY going to do before we sell in 6-8 years because it will add about 25k to the sale price.  Is it better to add the bathroom now, leading to a couple hundred dollars of cash flow more a month, and also likely better tenants, or should we leave it like it is and remodel before we sell?

2.  The floors are really nice (after we scraped off the grime - it was a foreclosure).  It's a honey laminate that is really sturdy.  The doors and trim are slightly darker wood and feel slightly dated but are in really good condition.  I would love to paint the trim and doors white or just replace it all.  Is it better to completely modernize the space before renting?  Or should I let my tenants destroy the old doors a bit and just replace them when we sell?

3.  Lastly, I know we're entering the blackout period for rentals.  Probably pretty unlikely we'll be ready for a tenant on 11/1.  Probably pretty unlikely that we'll get a tenant on 12/1?  Probably impossible to find a tenant on 1/1 (no one's gonna move on new years day).  If I decide to do some of the work above, it will slide me further toward spring and better chance of tenants, but I'll be paying about 400/mo in hoa/tax/ins until there is a tenant.  Should I push it and try and get someone in there ASAP or is it better to take my time making the place perfect before renting?

I guess I'm just looking for any guidance you guys can give me!  The place will be a solid B when the new paint is in, but with another bath and new doors, trim, etc, could easily slide into A territory, ideally adding about 2-400 dollars in cash flow.

Thanks in advance for the help!!

Tim W

So, after no one shows up to claim the money, because of a lack of heirs, does it just default to the state or the sheriff's office?

Hello BP!

I recently purchased an auction property for 103k.  The amount owed on the loan was 75k.  Since the sale was confirmed by the judge today, I was on the phone with the sheriff's foreclosure department asking questions about the deed.  I randomly asked about the excess money paid and what happens to it.  The representative confirmed that there is a 27k surplus that the sheriff's office will hold on to until the owner  or heirs claim it.  She said that she was not sure if I was on the list of people that would be able to claim the surplus.

The owner is deceased and has no heirs.  There are no addresses for any person other than the address of the home I purchased.  All of the correspondence going to the deceased and heirs are being send to the same property.  No one has maintained the mail or the home, and no one responded or attended the hearing.

I'm not getting excited here, but the idea that my purchase might be 27k cheaper is seriously giving me chills!  Any one go through this before?  Any chance I will see that money after the non-existent heirs don't claim it?  

Thanks for the tips,

Tim W.

Thanks again for all the input guys! I knew that I shouldn't be getting impatient. This morning, I won my first auction property! it was intense, 18 bidders at start, and I stayed 2k under my max bid (which I inflated a bit due to doing my own rehab work). I'm tingling!!! Cheer's to number one!!!

@Account Closed

Thanks for the response!  You hit the nail on the head there.  Your post explains exactly what I've been running into at the auction.

I think my edge is more on the investor contractor side of things and I potentially need to re-evaluate my buying power.  I have several contractors in the family and a good deal of friends that offer materials and services at cost.  Being that I'd like to do the work on at least the next 1 or 2 properties, I should be able to bid a bit higher.  First auction has me being very cautious though, I wan't to make sure it's a solid deal.

I have been looking in to direct mail and some other ideas to increase the likelihood of finding a property.  My real estate agent also has my criteria and is on the lookout.  Researching and bidding at auctions has taught me a great deal, but it's time to branch out.  

Not sure where I'm gonna find it, but it will be soon and i'm excited!

Hey, thanks for the responses!

I've been listening to podcasts and doing as much learning as possible.  I'm going to try and branch out with some other marketing techniques to add to my auctions.  Still learning a great deal every day I am on BP.

With Direct mail, it's basically up to me to work magic with the people when they actually call?  I was able to find a template for a mailer, but no idea what would happen next.  If I do convince them to sell, do I go through my realtor at that point?  I'm sure there is a post somewhere with Direct Mail laid out.

Also, I have a good friend who is my realtor and I have laid out exactly what I am looking for with him.  So that opens up even more possibilities.  My goal is to find a few investors to befriend to open up more possibilities on finding some properties.

@David Brown  How do you get the property and they keep the loan?  I haven't heard anything about this before.  Properties for so cheap by catching up late payments?  Is there a thread explaining exactly how this works?

Anyway, I'm off to read forums,

Thanks again,

Tim W

Hey all,

Some history about us, my partner and I flipped a house that we bought as a HUD foreclosure. We profitted nearly 60k on this property and we are now sitting on roughly 110k in cash. Our goals were initially fix and flip, but after watching several bigger pockets podcasts, we both decided that the BRRR technique showed great promise. We are keeping our options open for whatever comes along.

We decided to start with auction properties, since here in the suburbs of Chicago it seems there is a huge shortage of ANY property selling for under market value, including REOs.  It took about 2 months to develop a system that works well:  Pulling auctions in our price range, comping out the ones that we think will work, driving to look at the properties, having a title company run title searches, etc.  Whittling 30 or so properties down to only a few.  We have been actively bidding on 1-3 properties a week for about 2 months now.

We have had a few close calls where i was only a thousand or a couple hundred dollars away from winning the property.  The properties we are interested in after due diligence always have a good amount of aggressive bidders.  All of this is good.  We know that we are doing the right things and bidding on the best properties.  My problem is that we are always outbid.  Sometimes it is a bull headed person that seems like they will bid up to ANY amount.  Sometimes it seems like it's a representative of a wholesaler who bids and wins several properties that day.  Sometimes it's an odd situation where 2 or 3 people take the property WAY outside of profitability range.  It's almost like the people outbidding us don't need to make a profit.  

I know I should not despair, but it's been nearly 5 months of paperwork since we sold our first house, and I'm getting antsy.  Any words of encouragement or advice is greatly appreciated.

Thanks BP!

Tim W