All Forum Posts by: Sean Schellenger

Anyone wanna buy the brooklyn bridge? I have it under contract....!

Philadelphia is without a doubt a great place to invest!!! Just make sure you know which areas....

Ryan,
Sounds like you have some valuable resources available to you. The first being your location. Contrary to what Tim said, in my opinion, Philadelphia is one of the best places to invest. Your fathers firm is definetly another great resource. Not only should you learn as much as you can about the forclosure process and how his firm is involved, but more importantly, you should see if they can help you get some great deals. Im guessing there is a good chance they can use their connection with the lenders to cut a deal for you before it ever reaches the sheriffs sale. Look into it! Another resource you should look into is at Penn State. I majored in Business Administration at PSU and minored in real estate. Ken Lusht was the head of the RE department and taught some great classes on REI. There was also a financial real estate class which I actually tudored when i was there. It also had some great information that you will surely apply in this field. If those classes are available, I suggest adding one or two each semester especially since it doesnt cost anything extra to add the extra credits. I also suggest that you pick up a few books about Real Estate Investing Fundamentals to help you understand the different aspects of a real estate investment. The info you will get out of those classes and books is far more valuable than anything you will learn from any guru asking for money or REI club. The REI clubs however are a great resource for you as well, but the main purpose in my opinion is to network with other people involved with real estate in your area just like you are doing now!

I agree with Lucia.... I say clean the heck out of the stove and fridge, throw some fresh paint on the wall and put some window fixtures up to make it a more apealing for a small amount of time and money. Other than that, I feel that Lucia pointed out the most important factor which is that every month the home is vacant, it knocks 8% off your revenue for that year.... I suggest offering a free month over dumping money into rehabing the kitchen.

I agree with Ryann 100%.... great post.... Build up your cash flow from flips then start using some of your profits to begin building your rental portfolio..... Flips and wholesale deals pay the bills and allow you to live a compfortable life while rentals can be accumilated over time and eventually used as a type of retirement plan... assuming you can only get financing for a few deals at a time, it would be wise to wholesale the excess deals you find when your hands are tied.... no garbage though, only properties you would be buying if you had the ability... just my 2 cents, good luck....!

Joe,
1. Next to comps and rents you wrote "supposedly"... this information must be accurate in order to analyse a deal.
2. Read about the 50% rule and the 2% rule on this site. These are rules of thumb to help determine if a deal is worth pursuing. Both rules say "NO GO" on this particular deal.
3. Keep looking for deals, and keep learning.... Good luck!

Sean

Robert,
I have gotten financing for several of my investors who have similar situations. While cash is obviously king, we all know the importance of leverage in this business. You are far better off if you spread your money across several sfr investments using leverage rather than dumping all your cash into one deal. We use hard money initially and once the properties are fixed up and rented out, the lender will give you a blanket loan covering all the properties. At that point, the income being produced from the rents will make up for the lack of personal income. This is not typical with most lender's however there is a way to make it happen, and you will have far more success in this business if you do so!!

In my experience, the one month for free option is far more attractive to prospective tenets. In addition, it allows you to keep your rents at the same rate so you wont have to take the lose or try to justify an increase in year two if they choose to stay in the home for a second year. Id be willing to bet this unit will see much more action if you advertise the free month as opposed to a $100 reduction. Also, I would contact the people that have recently looked at the unit and offer the free month to them before i do any advertising.... good chance one of them will jump on it if they were considering it at all after originally checking it out.

Bienes,
Wholesalers are just one of many different resources that can be used to find a good deal. There are wholesalers who understand how to analyse a real estate opportunity while others have no clue. A truely dedicated real estate investor should look at as many deals as possible in their targeted areas. The more wholesalers you network with, the more properties you are able to see.

To say that wholesalers only have bad deals is unfair. Anybody in the game is capable of pitching a bad deal wether it be a wholesaler, realtor, fsbo, investor, rehabber, bank, ect... It is entirely up to the investor to make the final analysis and decide if its a good deal. Set a criteria and apply the formula to as many opportunities as possible. Wholesalers are a great source to find those opportunities. You were correct in assuming that many wholesalers only sell to newbie's due to the lack of knowledge on the investors end and lack of good deals on the wholesalers end.

In order to take full advantage of a wholesaler and minimize the bs, i suggest you lay down the specifics on what you want (location, price, purpose, size, ect.). They will start looking specifically for you based on your criteria and contact you as soon as they come across a deal that would work for you. As time goes by you will learn which wholesalers are worth staying in touch with. You definetly want to be on that stable list of buyers you mentioned if you are dealing with a wholesaler that is any good.

Wholesalers are like free employees... if their numbers work... why wouldn't you use em'?!

Sean