All Forum Posts by: Trevor Smith

Hi @Daniel sisto--great posts. I am very interested. What online business directories should I sign up with? I'm really hesitant to pay for things like that because they are so intangible. I will never have real proof that they do anything at all, you know? 

I currently have an Investor Carrot website and I have followed their training program for SEO. Well, I've done my best to follow it. Apparently, blogging about everything to anyone that will listen is next! 

I will share my advice from one noob to another. I'm doing my first flip in richardson, tx. and I have learned a LOT. 

You need to get real comps(idk if you did or not). Get a contractor to give you a rehab estimate. They will come for free--just make sure you are respectful about them giving you their time and entertain the idea of using them for the project. Ideally, you would even get 2 or 3 of them to come. Stop using Zillow for comps or values of any kind. I use them to look for photos and taxes and that's it. So make friends with a realtor that values working with an investor. One that knows you'll be buying and selling a lot of houses in the future instead of just one house and then he has to find a new client. A good realtor will get comps for you within a few hours or less. If it is taking them until the next day, get a new one. 
As for paying cash or not, and whether you should do the rehab or not, can all be determined by crunching numbers. The cash thing depends--if you can get a super low interest rate, and the rent is covering your costs, then you will save some of your cash for another deal. On the other hand, if you see that paying all cash takes out interest and loan origination costs, and increases your cash flow, then maybe that is better. And you ought to do only one deal at a time anyway, so you don't need that cash. 
As for doing the rehab, you'll have to see if the money you put in, and getting $1200 a month, is a better return on your money or not. And you want to be absolutely certain that $1200 is accurate. My parents and I bought a house in Lubbock expecting it to rent for $1200 and it rented for $950. It really turned the deal into a turd. 

Conclusion, learn how to crunch the numbers. It is a must. 

I live in Dallas, doing my first flip in Richardson now. I'm also looking for my second deal and how to finance it which I am making progress. I'm very excited about finding a multi-family and living in it. But it is obvious that most people selling right now are looking to cash in on the high market, so I feel like a fool to buy now. So it will take a motivated situation is all--I believe there are deals in every area in every market. But I don't mean to hijack--welcome! 

@Gustavo Figueiredo I did not get anything negative from your posts. I know what you mean. If I had money to put down, I would. What I can do is borrow that money too. Which I think I could make happen. It is unthinkable to me that I would ever walk away from a failure without consequences. I would feel like such a loser that I don't know how I would forgive myself. But other people don't know that about me. They might think the same cynical thing about me if I had no money to put down. 

@Marta Natalia No, I don't currently have a deal to discuss. But I do know I want to house-hack my next purchase. I will have to take a different loan for that. Actually, I'm very glad you told me about the NOO thing for private lenders--I didn't know that. I think I can get a partner to handle the loan from a bank for that. And I can use private lending for NOO properties in the future. Thanks so much for your feedback. I will keep your info for when I have a deal to present.

@Marta Natalia: It would be wonderful to know that if I find a good deal, there are people that want to hear about it, even if my income is very low. I mean, my income being very low is the whole reason I'm here. If having good income is a prerequisite to becoming a REI, then what are the rest of us to do? That is rhetorical--I hope we are agreeing that I can still do it!

What terms would you be offering if I found the deal and did all the work, but your lender got the loan and paid the down payment? I'm in Dallas, TX. Do you have a trusted peer here?  

Okay, okay..I gotcha. Thanks again this was very helpful. @Chris Mason

And I hope to others that are reading! 

This is very eye-opening. I realize I know very little about loans. If you know somewhere better that I can learn about this, feel free to tell me, otherwise I'm going to ask you a bunch of questions lol. Or you can do neither tell me a better place, nor answer me. That's fine too. 

So someone like you would originate the loan and charge a fee for that, and then sell the loan to fannie or freddie and be done with it? And places make a business out of charging the fees and selling the loans? 

Thanks so much for your answers and clearing up those acronyms. I've never seen either one. I've never heard of the underwriting system. @Chris Mason

I am also very much needing to learn some creative ways I can get loans. @Chris Mason, What is AUS? Is that a California bank? And what is TLDR? Be careful using acronyms when you're answering questions--I mean, they're probably being asked by people who are brand new or newish. You can't expect everyone to know your acronyms. 

I learned that commercial loans work differently and will be based on the deal instead of on the borrower. You're saying that can be true for a residential loan as well? If so, that is good news because I make next to nothing as a freelance artist. I think I read that DTI under 30% is what ya'll look for? I might be mixing things up. That means that only 30% of his income is being paid to debt? So he has 70% from the rents to buy food and everything else. That is hard to believe that he would have 70% left over. Is that right? That deal sounds impossible to find.

Thanks!

Duke, I am not as knowledgeable or experienced in this arena as the other posters, but if they don't work out helping you, I do know some people that want to invest some money in real estate and maybe we can all work something out. I think they would be interested in what Dan Schwartz suggested about sharing 10% of the property, or some other creative compromise. I really feel for your position because I am also doing a flip and well, I can relate. 

Feel free to message me. 

This thread was absolutely full of good advice by edward stephens! How is that duplex working out for you now?