All Forum Posts by: Robert T.

Not a scam.  They've been around for a very long time and I've gone to some of their seminars.  Eddie Speed is probably the foremost teacher/guru on note buying.  I have friends who swear by them, but others who have had less favorable experiences with them.  You will need to pony up some dollars to get their list of notes.  As with any investment, do your own due diligence with any note you buy and verify everything.

In our lower end flips we'll often paint our cabinets if they are still in good condition.  I.e., drawer fronts are still good condition.  We typically spend about $4k for cabinets plus installation costs if we replace them.  If our repair and painting costs come close to 50% of buying new ones, we'll typically just replace them rather than paint them.

Have you physically seen the property and driven down the street?

I’ve purchased in many areas in Nor Cal including the hood in Stockton and I have never felt as un safe as I did driving down Rennick a few years ago during the afternoon. There’s been a burnout on the street for several years. There are only a few areas of Sacramento that I won’t buy and Rennick is one of them. I’m guessing that if you looked at ownership records you would find the majority of owners in that street are out of town. Other than that North Highlands is like any other C class neighborhood. 

Since you are out of the area you should probably just hire a local attorney who handles evictions.  They’ll be able to help you keep your nose clean and not create an appearance of retribution. 

Okay, for having formerly worked in the Silicone Valley, I'm still pretty old school.  I think everyone should master MS Excel and learn the basic Financial functions.  Some people use financial calculators (I have two of them) but I still think Excel is easier and more flexible.  I also think Quickbooks is invaluable for me.  I do all of my accounting in QB - John Hyre has a course you can buy on QB for investors which is really basic if you're already familiar with QB, but I like how he keeps it simple. As a lender, you may also consider looking at T-Value.  It does amortization tables quickly and easily, and also allows you to calculate graduated principle payment mortgages if you are doing creative financing.  Having said that, I wouldn't over complicate your life by buying expensive apps or programs. 

Christian, congratulations on getting started. This doesn’t directly say how to finance your personal residence, Jefferey already gave you a method of doing that. I’d like to take it a step further. 

Most investors don’t invest in projects, opportunities or houses - they invest in people. People buy IBM not because of some new widget they invented. Everyone has some new widget. No, they invest in IBM because they *trust* IBM (or some other company) to be able to produce and sell and make a profit from the widget. 

Two different people may bring exactly the same deal to an investor. Which entrepreneur will the investor go with?  That’s right - the one they know and trust. 

The important thing to remember that people aren’t investing in your product , they’re investing in you.   Even banks are investing in you, not your house. Just ask any bank if it’s okay if you transfer your loan to another person. The answer will typically be “no”. They invested in the original borrower. 

Having said all that be the person everyone wants as their nephew. The person they want to take under their wing and invest in. When you are that person money is no longer an issue. And if they say “No”, it’s good to ask if the reason is you or the project. Either answer provides a wealth of learning. 

You could offer her cash for keys and tell her that you will drop the eviction if she moves out immediately and leaves the place clean. If she has an eviction she won’t be able to apply for Section 8 again so offer her a graceful way out. 

Positive cash flow is far more important than the amount leveraged. If you over leverage and have negative cash flow it will probably be your last deal. Though there’s different opinions on what percentage of your monthly income to estimate for repairs, vacancy and turnover generally the numbers are 30-50% of your monthly rent goes to expenses. That means your monthly mortgage payments need to be less than 70% of your rents. 

It depends on the market. I’ve offered above asking when the competition is tight and the numbers still work.  I don’t expect to get a chance to make a second offer whether it’s buying directly from the seller or through an agent. 

I always try to build relationships with other active investors with similar business model as mine - I.e. same class of properties and repair quality. I then network with them to exchange our tradesmen.