All Forum Posts by: Ward Mcdaniel

Hi Michael,

BP is a great place to learn, so hang in there....cuz there is a lot of stuff to learn....living paycheck to paycheck sucks and you are right to try and change your situation.  However, quitting the day job is not a great idea at this point....perhaps you should read Rich Dad, Poor Dad or buy the Cash Flow game and learn about passive income greater than your bills each month....Brandon says 2x your monthly debt and I think that is smart.

On the flip side, I've been married 25 yrs and divorce is a situation that I have witnessed in friends and family and it is never an easy circumstance.  One day your 3 kids will be going off to college and you will wonder how in the world that happened seemingly overnight...do not let your current dislike of your JOB affect your relationship with your family....that is a huge mistake but can be stopped...by you.....why?? You now have BP and a goal to get out of the rat race...it is easier with your wife and kids on board - work together towards a common goal, it will bring you together during the struggle and teach your children how to think like investors and enrich all of your lives....

hope this helps,

Ward 

Hi Blair,

I also live in the Greenville Area and am an investor and agent (our office is downtown Gvil).  It is great to see you around the site. 

First, know what your exit strategy is for this property...2nd know your purpose for this property.....once you figure those things out, You should consider a few things regarding the purchase of this property: determine your minimum amount of COC - at 3% you can make double that in stocks....In addition, $1300 for a 2/1 is an interesting fee for rent for that size of a house....also, the vacancy rate may get you into a situation where you would have to pay the mortgage for a few months - can you cover that and then how many months? you get the idea and then you would need to factor in the CapEx and any PM fees and closing cost all of those fees involved with the purchase. Excitement to get into the game is great, but be cautious so that you can remain in the game and score time after time....

If you want to meet sometime for lunch one day, send me a PM or text...hope this helps.

Ward

Hi Aaron,

I have a long time tenant and we have a good relationship and sometimes it is necessary to look at the whole situation when dealing with them.  I have been in the same situation and allowed them some leniency.  The monkey then is on their back to get it right the next month....Unfortunately, life happens and sometimes too quickly and if your PM is still high on this tenant paying, then I side with Kyle; let her make it up on the next months rent.  Sometimes, this little gesture by you will turn into a big deal to your tenant and she will think that you are gold for being understanding.  However, if this becomes a pattern, then with her 12 month lease coming to a close, it may be time to part ways.  Hope this helps out.

Ward

Hi Karl,

Another way to look at the partnership is to have them put up more of the money out of pocket on the front end and then you split the money evenly on the back end....for example: on a 100k DP - you put up 25k and they each put up 37,500 and then if you sell and realize a 60k profit - you each get 20k.  You may want to get paid first for all of the work/headache that can be involved with acting as the PM and the GC of the entire deal.  Of course, this depends on the relationship with the partners and the contract drawn up between all the parties.  That is a must - it just helps ease the process.  

Just another way to structure the deal...hope it helps

Ward

Hi Adam,

Your house is near Moody AFB - you can probably get the rent you are needing from someone there w/off base housing allowance...renters will be more likely to not steal or damage anything beyond normal scope of renting....house is only 7 yrs old -  roof/hvac/appliances and other repairable items will be ok for at least 5 yrs or more.  If you can afford the 10k loss up front - then the repairs and capEx may make up for the deficient amount of rent to at least break even because it sounds like you can afford that cost. 

I would re-evaluate your real reason to sell: if it is because of not wanting the hassle of being an absentee landlord - than you must take the loss and move on.

However, w/good PM in place and as Walter mentioned get a good rate - ask for a military discount. The negative CF may be mitigated to breaking even or positive  CF for a few years until you can sell it without taking a huge loss.  If you sold it in 4-5 years and break even or take a 3k loss it is a lot better than selling now.  

Hope this helps and thanks for your service to our country. My family appreciates your sacrifice.

Hi Zac,

Here is the basic terms of the hard money lenders from my area. You find a property and the ARV = 100k. The HML will give you 65% of that number so 65K and charge you 12% more or less depending on some variables like experience and if you have done business with them before etc....the term of the loan can be 6mo, 12mo or even 24mo interest only with the balloon on the back end at time you resell the property or the term is up. Also requires a 20-25% down payment and may even charge you 1-5 pts on the loan up front - or wrapped into the loan amount.

You have to find the right property and rehab cost to make money, but it can be done...let the numbers guide you, not your heart or desire to get started in the game.

Hope this helps out

Hi Kelly,

I am an investor friendly realtor in the Greenville, SC area.  It is a great title and means nothing personal or otherwise except that you understand the investor mindset.  It helps that I am an investor as well and know what I would want in a flip or a buy and hold property SF or multi.  It's basically a question that you have to answer for yourself now that you have gathered the info.  

If you are not an investor, I suggest spend some time with the tools section at the top and learn about what investors are looking at in ROI % for the flips, the scope of work on the rehabs and the CF and COC for the buy and holds.

Work done and knowledge learned will always be returned to you, if not in the current deal that you place the offer for the investor than the next or the next....just keep at it....

hope that helps you out...

Hi Dave,

I have researched the area a little bit and know that it will depend on the type of landlord you are wanting to be. Of course, as you already know - it depends on the location of all the properties. I think that I know the properties that you are talking about if they are listed on the MLS. You may want to drive to the area and see for yourself. Would love to talk with you more on a personal message or via phone.

Hi Henry,

Personally I would walk away from the deal unless he fixes the discrepancies from the inspection report.  If the foundation is damaged...roof....plumbing...electrical...etc is not fixed - 20K may not be enough of an estimated cost of repair.  

In addition, 4% CoC is not enough for me - you could get a better rate somewhere else..I would determine the lowest minimum CoC you would be willing to realize and then that combined with CF and a few other criteria would make my decision. Let the math guide you....hope this helps

Hi Annie,

What is the math telling you?  Use the rental property calculator at the top of your dashboard page to figure out if this is a good deal. At 2.5 hours away you will most likely utilize a PM company, which will suck some of your CF.  I like what Jeremy said about the person who flipped the house - why weren't the items you listed already taken care of in the first place? It sounds like you have made your decision already - your gut is telling you NO...and the math is telling you NO - then with everyone else here on your question, I would agree = NO, wait for the right deal, don't settle.