All Forum Posts by: Zach Mitchell

Also, what's the math on the amount of interest you pay in 3 years vs the amount you pay over 10? If it's an extra $50k, could you make that and more by investing first? That's the question you need to answer. Keep in mind, the debt to income ratios for any loan you try to get are going to be severely weighed down by the minimum payments on $300k. That's another factor.

Do both if you can. Try to leverage other people's money where you can but still have a piece of the deal. $300k is a LOT. Don't want to miss out but also don't want $300k to be compounding at 6.5%.

I wanted to bump this again. There has been a lot of discussion of which is better but it always comes from someone using one of them currently. Has anyone really put efforts into each system and come out with some real results on which drove more traffic or had the better SEO performance? 

My major was real estate and I would recommend it for anyone in college who plans to get into real estate when they graduate. However, I think you can learn everything you "need" to know to start investing in real estate from reading a few books and asking specific questions here or searching for those questions here. I think you can even find a lot of those classes on YouTube. There are really only a small amount of concepts you really need to know before diving in. Learning from experience is so much more valuable. I would spend the money you were going to spend on those classes on deals, or marketing for deals.

You need copies of the leases to know how each one is structured. One could be different than the unit next door. The overall analysis is still the same, income minus expenses = net income but it can get very detailed. The most accurate way to value a retail building is the discounted cash flow analysis but that's very detailed. Do a quick google search to get an explanation. Using the direct cap method with a cap rate and net income to get to a value can work but it just depends on the amount of units and the lease structure.

I wanted to get this discussion going again. Any further insight? Also, any comparison to REI Blackbook?

There is someone on here who has done this, can't remember name but I was considering it in the past and came across those posts. One big thing is that it would have all been cash. Is the property owner okay with you putting up THEIR house to secure a HML for the rehab? They must not be too knowledgeable about any of this or I don't see why they would do that. They could just get the HML on their own, hire a GC to run the entire project and keep all profits. The benefit to the homeowner in a situation like this is the experience and cash brought to the table by you for the rehab, not someone putting up their house as collateral to get funds.

MAKE THE OFFERS! I don't mean to yell but what are you waiting for? When you look back on these properties and see that one went for less than what you would have offered you will see why it was worth it to make the offer. With that said, only make the offers if you're ready to buy. Don't waste anyone's time, including your own.

Also, I have to disagree with Russell. You don't need comps for a low offer. You ran your numbers and that is what the property is worth to you. I think comps are a lot more important on the back end if you're needing an appraisal for a flip or a refi. On the buy side it's what you're willing to pay, that's that. 

@Ryan Biankowski It might be worth finding a local investor/flipper who you can invest with and have him/her teach you along with way. If you offer your money with a low return, maybe 5% cash on cash with the caveat that you get to shadow them it could work for both of you.

Think you should have signed a Fannie Mae contract addendum at the time of your offer, it's in there. It should also be in the deed itself. I don't think they would have sent you a copy of the deed in the closing docs. If this is a full remodel you don't need to worry about the 90 days. Sounds like a lot now but in about two months it might seem a lot different. That's just how rehabs go....