All Forum Posts by: Trent Stone

Flipping Formula

(ARV x .7) - Rehab costs = Max Offer

(65,000 x .7) = 35,000 = 10,500

A 30k return on your 6k purchase price? If you are sure about your numbers it's a no-brainer. 30k for more expensive flips is a good return. Also, J Scott says he likes the total guts even more than moderate rehabs because you are already expecting the worst and you won't have any surprises. Make sure you have concrete bids for the rehab and you have a good contractor and your ARV comps are solid.

The house I'm living in now was a smoker house and the smell is hardly even noticeable now after a couple months. If I were you, I would replace any fabric, ie. carpet, I would pay a cleaning company a couple hundred buck to do a deep clean, change any HVAC filters, then I would go to Home Depot and buy an odor bomb or two. Air out the house as much as you can and get some Glade plugins for smokers and I think the smell will be gone in no time. I would use the smell to try and negotiate an even lower price though, most buyers will be thinking the same thing as you but I think the smell will be an easy fix, so, might as well use it to your advantage if you can. Just depends on the market and the seller. Best of luck!!

Our brokerage uses Docusign, I like it better than the other ones that outside agents send to us.

People do subject to sale all the time without being able to carry both loans, that's what the clause is for. As long as you have the subject to sale written in your contract you'll be fine, the mortgage company will only care about your back-end DTI at the time of funding and recording. Worst case, depending on how bad you want the house, you could get an interest only bridge loan from a private lender then refinance as soon as you get your first house sold. From what I see most of the time it's the sellers that you have to worry about. I've seen as many as 4 or 5 buyers' offers fall out because of the subject to sale so depending on your market some sellers might make you take it out or they won't entertain your offer. Just make sure you have a competent agent who can negotiate the subject to sale well with appropriate deadlines so you don't lose your earnest money in case you can't sell your first home.....Side note, we tell our clients to NEVER put down any hard earnest money unless they are desperate. Hope that helps, best of luck to you!!

Any promo codes for the bookstore? Particularly the BRRRR bundle or the book on estimating rehab costs?

@Braden Anderson We should get an investor mastermind group going or something. I'm very interested in connecting and networking, early in the week works best for me. Let me know if you have a day or time that works and maybe we can throw something together in the next couple weeks.

@Braxton Futrell Any luck finding anything about an investor friendly broker? I may be moving my license soon and I'm looking for the same thing.

@Israel Gabriel Martinez I found a quote in my morning reading and thought about the situation with your family. 

"Don't be dominated by people's thoughts, opinions, or judgements. Work hard for your own approval or God's approval -- Those are the only ones that matter. Create a life that satisfies YOU."  - Ed Mylett

I highly recommend his book "#MAXOUT YOUR LIFE"

@Parker Judd you are very welcome. The podcast is fantastic. Also, don't forget to read "Rich Dad, Poor Dad" if you haven't already, I think it's illegal to invest unless you've read it lol. 

First, You can be a successful investor in any market if you are willing to put in the work. Honestly, you can be successful while you are still in school too. If you just set aside 10 or 15 hours a week you can find off market deals to wholesale and you can make decent money a learn a ton. You can also find a skill you have to add value to a local investor and work for free while you learn from them. Not to mention the endless amount of knowledge you can gain by reading real estate books, forums, and networking. Make as many connections as you can and listen to everything the seasoned investors have to say about finding a mentor, especially what @David Greene says on the podcasts all the time. Also, you can work on getting your real estate license while in school and work part-time as a realtor. That route is not for everyone but it's what really ignited my investing career.

I spent over 6 years studying in college and I have never used a degree to find work, however, much of what I learned has served me very well in my career. I would say to play to your strengths. If you are a numbers guy, basic accounting and finance will serve you very well in real estate investing. Understanding things like IRR, ROI, COC, time value of money, etc. I would also recommend a few lower level econ classes (Upper econ turns into theoretical calculous and I don't think will serve you well). Understanding how the markets work, supply and demand, trends, government impact on markets, and being able to predict patterns will help you a ton. No matter what your strength is, you should take business and entrepreneur classes. I dislike marketing and OBHR, but when you are building a business you at least need a basic understanding of those topics and I had to take them as part of my business degree. I think it goes without saying, but if your school offers them, you should be taking real estate classes. Here, the University of Utah offers a business degree with an emphasis in real estate. Just south at Brigham Young University they don't, but they do have a real estate investment club which provides enormous value as well. See what your school has to offer.

I hope my response was helpful. Seems like you have a bright future in front of you, I have no doubt you can have a successful career in real estate if you want it bad enough. If you haven't done so already, make sure you read "Rich Dad Poor Dad". Don't hesitate to reach out if you have anymore questions or would like some more advice. Good luck!!