All Forum Posts by: Eric Tomlinson

Welcome Kathy!

Spend time reading through the threads and then ask questions. Learn what you can, but ultimately nothing can take the place of real world application and learning through doing it. And then ask more questions....welcome aboard.

Eric

You have some invaluable information in this thread. One thing about Jon stating making multiple offers and having multiple offers accepted: If this happens, you could cherry pick the deal you want to do and wholesale the other property to another investor, assuming you got the deal at the right price. Either assign the contract if they will let you, if not then do a simultaneous close with transactional funding.

If you don't want to or don't feel comfortable doing either of those, you could terminate your deal and try to network w/ another investor and send them to the deal and maybe get a small 'bird dogging fee'.

Good Luck.

Charles-

I was reading in the older archives and came across this thread. Can you give us an update on what came about in respect to this property?

Eric

Jasmine-

In my area the houses for sell less than 60k are usually 35-55yrs old. Being that age usually has 'defects' compared w/ newer homes. Example: the house might not be grounded, or it has aluminum wiring, the old cast iron sewer lines begin rotting around 45-50yrs old (I've had to replace them, not cheap) HVAC system may be over 20yrs old, rotted wood under pier and beam house.

There are many things to look for at that age that cost a substantial amount of money. But for me a 'typical' older home that I buy to rehab/rent without finding the aforementioned sometimes hidden surprises will cost around $12-$16k for a house around 1100-1200 sq ft.

One thing to keep in mind is that it maybe easier for you to purchase a nicer 60k house as most conventional lenders like to have a minimum loan of 50k.

There are some local banks that will specialize in real estate investing that will do short term loans and they will lend up 85% of purchase and rehab, of course not to exceed 80% of ARV.

It might be easier to snag a great house and rent it and sell it with a renter to an investor that wants good cash flow.

Good Luck.

Chris-

Thanks for the good insight. I might file another lawsuit just to make me feel better. Not only for the lien, but also b/c the GC worked through a stop work order from the city. I found out it was in place 2 weeks before closing! Needless to say we didn't close on time and only closed after I paid the double fine and jackhammered out the new travertine and plumbing in the bath to show the inspectors.

Who needed that extra 6k? I probably learned more from that house than all the others I have ever done and it cost me the most by far!

Newbies- Get lien releases from all parties involved, keep a retainer from the GC until you are 100% everything is done correctly, make sure permits are pulled!!

Eric

The 50% rule says you can cover your PI payment w/ 1/2 the rent. Assuming 20% down and a 30yr note at 7% you would be under the 700 a month number. Your down payment would be 25k plus ~3-5k at closing. The PITI based on your info is around $980/mnth.

Ultimately you are the only one who can determine if those numbers sounds appealing to your investment strategy.

I don't know your area, maybe that is a good deal or maybe your money could go farther elsewhere. In my area those numbers sound fine, I just don't go looking for rentals in that price range.

Good luck.

Jon-

Mostly have invested in sfr for rentals, but have fixed/flipped a few as well.

For the near future, I am just trying to add to my rental portfolio, but always have my eyes open.

J Scott-
Thanks for the response. Unfortunately the GC was referred to me from 2 different wholesalers in the area whose other clients had done a lot of business with and were happy. Apparently my house came around on his down hill slide. I figured I was busy coaching summer baseball and would turn it over to a GC instead of doing it myself. I 'assumed' he was good for it. My fault. Live and learn w/ a lighter pocketbook.

Chris-
I am already suing the GC for another issue. The amount was just over 12k and I figure I won't get anything out of the broke contractor so I sued in small claims for 10k. This suit is for a different job (were going on at same time). Should I sue him again?
I did get lien releases from him but not from the subs. As a first timer hiring a GC I now know to get lien releases from all parties even though his lien release says he paid his subs, BS.

Thanks for the help!

Thanks everyone for saying hi. I see there are many of us from the Dallas area.

Bryan- I get a little on the envious side when I see someone from the Austin area, or maybe its just the college kid in me as that was my old stomping grounds quite a few years ago! Hook 'em :)

Eric

Thank you Jackie!

Shelly, what part of the area are you looking to invest?