All Forum Posts by: Mark Freeman

I would start even lower. Maybe $100k. ($115k or $120k or even $125k sound much better if you have to come back up after starting at $100k), Make good conversation as you walk through and then be really surprised when you see a few things that are going to cost you extra money. I would get them thinking about the benefits of working with me a cash buyer and how fast I would close with very little effort on their parts. I show them my financial statement right away so they know I'm serious and not going to waste their time.

That said, how do you plan to pay for the house and holding/rehab costs? It may be difficult to finance, as is. Cash or hard money should be ok. The money is made on the purchase side of the deal, so learning to buy right is paramount.

What is your plan with this one? I own a similar one right now. Mine is a cut and fill on a hillside with insufficient compaction on the fill side. The worst corner on mine has dropped almost 2 inches. I would have been afraid to try and wholesale this house as most investors, as @ Jean Bolger pointed out, seem to be afraid of them. 

If you want to rehab it, it can work but there is a lot of time involved in the fix. Getting multiple estimates can take 3 to 4 weeks. Once you commit, they will need to get a permit. They have to get some engineering done and a soil test before they apply for the permit. ( Est. 2 weeks) Fresno wanted 4 weeks for mine permit and we decided to pay extra which is supposed to bring it down to 2 weeks. (Some places can go much faster - maybe even over the counter according to my guy and I imagine some could be slower as well). Once you have your permit you have to schedule the job, which undoubtedly will be at least a couple of weeks out. After it is finished an inspection has to be done. It seems that Fresno county doesn't have anyone on staff qualified so my guy is going to try to get the geo-technical engineer who did the soil test to do the inspection.  All said, the process takes a long time and mine is coming in around $20,000. I got multiple bids and had as high as $35,000 quoted. I think you could spend a lot more depending on the severity of the problem. My affected area is a relatively small corner of the house, about 12 feet by 14 feet on one corner with the crack and settling going between those points forming a triangle.

I think this could be overwhelming if it is your first flip and holding costs could be high if you are using hard money. The good news is the companies I dealt with are out of So. Cal and would service your area. I'm getting a 20 year warranty that is transferable. Good luck my friend. 

P.S. Most of these companies want $350 to come out and do an estimate if you aren't the owner on record. If you own it, they don't charge for that.

Great win! Go cougars! 

Good luck on the appointment tomorrow Tony! Let us know how it goes.

Here is a different take.

That 10% non-refundable is killing it! It seems crippling to me, even if you had the money. I wonder about upping the purchase price to say $1.8 mil or higher if necessary and the numbers work, and getting the deposit reduced to something manageable. (Maybe when you meet with him you can talk him into reducing it without changing the purchase price). Then get an inspection period, say 10 days, allowing a refundable deposit during that time. If you find out that you came in too high initially to get it under contract and your buyers don't like the numbers, then you renegotiate the purchase price during the inspection period. You have to convince them you can close fast and they won't get any more from anyone else due to x y z substantial reasons. (If you work the numbers really closely on each unit you can probably make it work without the inspection period if you can get the deposit down and have a buyer).

I'm not sure if this would work but I have used it negotiating with banks , while in escrow, on reo's and it works sometimes. (I got $35,000 off of $134,000 purchase price on a recent one, with a good reason for the reduction). If you have exhausted other options it might be worth trying. I'm not a wholesaler and am just throwing out ideas.

Awesome wholesale package! Any luck with getting it under contract yet?