All Forum Posts by: Tim Lindstrom

I know a guy who is renting a nice big house for 2600 a month, because his credit is too bad to get a mortgage.  He has been renting this same house since he lost his own home to foreclosure in 2009.

He refuses to downgrade to a smaller house, because he cares more about appearances than his bank account.

I'm betting that will peel, scratch, or just plain look bad after a while.  If you have appliances that you were going to swap out anyway, it might be worth a shot before replacing them.  

I'm following this to see if anyone who has tried this responds.

@Corey Smith, 

I look for properties where it appears the owner doesn't have the money or ambition to keep the property up.  

Along with all the usual things people look for (papers piling up in driveway, lawn and landscaping overgrown, broken or boarded up windows, tarps on roofs), I look for other signs of neglect.  

Gutters that are falling down, or have plants growing out of them.  Siding that is falling off (especially around chimneys).  Windows or doors that are obviously rotted (can see it from the street).  

If I drive through a neighborhood, and a large number of the houses are in this condition,  I move on, and don't mail to any of them.  I mail to those one or two unpolished gems in an otherwise nice neighborhood

@Atwan Kwan.  I use a separate savings account more for my own personal reasons than accounting reasons.  Having my 5K emergency cushion, in there reminds me not to touch that for other things.  Having t15% of rents going to that account gives me a quick glance at the ebb and flow of my capex dollars.  I could see all this in quickbooks, but I like having it separated.

My checking/ops account will actually get pretty big at times.   When I refi or sell a property.  that money goes there.  Only a portion of the money collected from rents goes to the checking account.

@Atwan Kwan I'm not sure how everyone else does it, but I transfer 15% of every rent payment into savings every month.  I seeded the account with 5K as my emergency fund.  The 15% keeps it funded for capex and emergencies.  My checking account is my working account. Everything else goes there to pay contractors, insurance, and taxes.  When I need capex money, I transfer from savings.   When I refi one of my properties, it will also be used to pay the mortgage.

I'm not big enough yet to automate.  When I get to 1000 mail pieces a month, I will probably start using a company like yellowletters or click2mail to send out post cards on a scheduled basis.  

For now, I just send out hand addressed letters to whatever properties I find while driving for dollars.  It ranges from 10-50 a week depending on how many times I go out, for how long, and what neighborhoods I'm hitting.

I can't tell you which lists are best, because I don't buy lists,  but I have seen on this forum that some people had bad results with some lists.  I don't remember the names, but people seem to like listsource.

Are you talking about undeliverable mail pieces, or responses form your mail pieces?

Response rate is 1-15%,  but I think you are talking about mail returned as undeliverable?  If so,  that really depends on where you got your list.  Some have a lot of garbage or outdated addresses, while other s are pretty clean.  I only do driving for dollars,  so my addresses all come form the tax assessors site.  They are about 99% accurate.

I think you have a good idea to send them out in bursts rather than all at once.  That's how I do it,  but that is more to control the number of calls I receive each week. (I only do this part time).  Rather than send out a 500 piece mailing.  I would send out 50 letters a week.

No matter how many properties you end up owning, you only need 3 accounts.  Like @Tyler Hodgson was saying.  one checking account to write all your business rlated checks from.  A savings acoount to stora all that money you're going to make, and a seperate savings account for secuity deposits.  You don't want to commingle the security deposits with your working capital. 

Quickbooks is great for keeping track of all your properties.  you can have a million dollars in your account, and quickbooks will tell you which properties generated which portion of that cash, and which properties are a drain on your money.

If you hire an agent who makes 20% of the profit over the listing price, they have incentive to list it at a low price to get a bigger chunk of profit.  They don't lose anything if the property sells at the low price,  but have lots to gain if it sells for more.

And the agents advice was contradictory.  you usually don't get multiple offers in a slowing market.  so going with this strategy if you think the market slowed down was flawed from the start.

Maybe your house is only worth 350K in a slower market, or maybe there will be other offers.  I'd wait and let the buyers know you will make a decision in a week.  This will give you more time to entertain other offers.  If you have a good agent, they will let any other buyers agents know there is an offer on the table, and you need highest and best by XX date.  Then go back to the original party and tell them the same

Depends on what your criteria is.

Do you want properties that have a lot of equity?  use list source.

Do you want properties where owners haven't paid taxes?  Tax Assessor.

Do you want distressed properties?  Drive for dollars.

Do you want tired landlords?  Eviction filings

the list goes on and on.  be more specific about what kind of list you are looking for,  and the great community of BP can probably help.