DEAL?

Bird Dogs, Wholesaling
21

YoungInvestor,

Did I miss something here? You keep saying that you can’t come up with the 10%-15% cash if the lender will only pay you 85%-90% of the LTV.

Most rehab investors I know will only do deals that they can purchase completely, including rehab costs, inside of that hard money loan…they MAY chip in some of their own cash for rehab…it just depends on the deal, but most will not. If they find a property that they cannot purchase with a 85% LTV loan, then they don’t consider it a “deal” and they walk away.

Right now all I do is contract assignments, and I will only do deals that have a 15% profit margin or better for the investor I’m flipping to (on assumption that they will be using hard money)…and that margin is calculated AFTER my fee is applied.

Using these rules, I usually have to get pretty deep discounts in order to make a deal happen, but when I get these deals on contract, they are always easy to assign.

22

Itz Marcoz you did miss something here, you missed the question that was to me, and just read the answer.

The question was: " You are virtually getting this at 35-40% below market. Just out of curiosity, why are you wholesaling this instead of taking the deal yourself?"

And I said that I cannot afford the other 15% if a lender were to loan me 75%, or the rehab costs. Which is why I wish to ASSIGN the contract to ANOTHER investor.
I dont know about you, but even if I do not have the money for this deal, I would not walk away from this, there have been investors who have replied to this post and said that they are, and would be interested in these deals, when I find more in the future. Hence, I can work out assignments with these investors, and Im sure they would not say no.
Cheers.

23

YoungInvestor,

I understand the question posed to you, but I still don’t understand why a hard money loan wouldn’t cover this deal for you if you chose to rehab it yourself. Here are the numbers you gave:

Investor Price: 38,000
work needed 7k
Comps: $83-91k Range

Even if the LTV on this house is $80K, then you could purchase and rehab, based on these numbers, for $45K. A 65% LTV hard money loan for this example would be $52K, which would give you a $7K buffer for repair overages, holding costs, etc. Even if you put this buffer of $7K back into the house, you would be $52K invested, and if you sold it at the bottom of your comp range, there would be $31K remaining…then after you pay realtor, closing costs, and other misc. stuff, you could still clear a hefty margin.

If I am misunderstanding the LTV on the house or some other info, please help me understand. I agree…don’t ever walk away from a deal if you can turn it in some way to squeeze cash out of it, but also don’t give away a deal that YOU can do for yourself to maximize your time and effort.

24

I understand what you are saying, but I have also never done this before, and to top all of that off, this home is in Michigan, and I am a Canadian living in Toronto, from what I have heard, to get a 80% or whatever amount loan, from a hard money lender they still look at your fico score. How is this possible, if I don’t have an american Fico score, or even a residence in the states. So I have virtually no money that I am putting in that is my own, I have no residence or any contact information in the states, besides my Canadian cell phone which I would be carrying with me, and I have no credit in the states. Would a hard money lender loan to me? That was and is still a question which I have asked different people, and havn’t got an answer for. I figured if I assign a few homes first, atleast I will have a track record and some references in Michigan that can back me up, when asking for a loan from a hard money lender. If I am thinking this wrong, please correct me, because I maybe about to waste a year of my life.

My goal / plan right now is to work for the next year well a little over half a year, save up around 10-15k, and by next spring or early summer, I can go into Michigan, and have some money of my own to put into the deals that I find, so a hard money lender will feel more comfortable. Like I stated, if this is the wrong way, or if there is a better way to do this, please advise. Until then, my plan is to see if I can assign contracts (wholesale), and just work. ???

25

My mind boggles at the idea of a property with great cash flow being in preforeclosure…

Beyond that ;D, YoungInvestor, on the left hand side of this website under Investor Resources there is a link to a long list of Hard Money Lenders. Each listing includes the states in which they do business. It wouldn’t hurt for you to email a few of those that do loans in MI and see what their requirements are…

Christine

26

A question for experienced investors. I have a 2 bed/ 2.5 bath townhouse that I recently purchased for 72k. There was already a renter in place paying $1100/month. The townhouse appraised (from a hard money appraiser) in June for 100k. The renter traded his first month rent to buy a new AC (which he did) then was late by a couple of days with his next month’s rent.

The thing is, I know it is a pretty good deal, but I still want to sell it. I feel like the renter I inheirited (although a real nice guy) may become a financial problem at some point in the future. Am I worrying for no real or should I follow my instincts. I’ve been told that I could get 85k-90k real easy for it from someother investors. I want the money to get myself out of other debt to improve my credit so I can buy other places. I have a pretty good network of investors, wholesalers and RE agents and believe I can repeat this process and making $15-20k for a couple of months time (and not much work) doesn’t sound too bad.

27

You answered your own question. You want to sell it. So sell it. You told us that you want to pay unpaid debt. So sell it. You will pay gains on the sale so beware of that. That is a cashflow critter and those deals are hard to find.

Nate-WI

28

Hey can any investors in Michigan area, or any knowledge on this subject help me out. I just got an email from someone, and he says that the laws are different in Michigan, and is asking me if I have a liscence to do this, What is all that about? He knows that I am an investor, not a real estate agent, since when do investors need liscences?

Here is a copy of the email:

(He asked me where I lived, in Canada or the states, and wanted my address, I told him I lived in Toronto Canada, and I am not giving my home address to anyone, especially someone who is supposed to bird dog for me) , his reply was:

Your in another country? I just want to know if this is for real that’s all.
I don’t fool with unlawful things. how do I know your for real? You are
hesitant to give me the info I asked for. Do you do business here in the
Detroit area? where? when? How long have you been doing real estate? Are you
licensed in Michigan? there are certain Real estate laws on the books that
apply to investors. Let me know and if you want to do business

29

YoungInvestor,

With the attention that real estate fraud has received in the past couple of years, many people are paranoid about the people that come across their path, and about the deals to which they are presented. Maybe this person’s questions are a result of that.

I say…always consult a legal professional when you have questions. Going to any other source is purely speculative, and could result in major headaches and missed opportunities.

30

If you have the right education on the specific deal and can present your professional help in a clear, complete and concise tone, there is not a deal out there you can’t close that comes across your desk. Are you people ready to be blown away? Watch for my Ad in the classifieds under partners wanted.

I hope everyone is doing well and here is to profitable investing!

31

Tony Chicago, could you elaborate, on what exactley is the right education on a deal? What are things that we must know, and things that are most of the time, not known, so that others and myself can be more prepared.

*Also can all investors who are willing to grab properties in the Michigan area, and work out an assignment with me, email me, private message me, or let me know on this forum. The few who have replied are on my list, and more is better.

32 
                                                    NON-CIRCUMVENTION AGREEMENT

THIS AGREEMENT is made and entered into this ___________ day of _______________ ,
20 , by and between , whose address is , hereinafter referred to as “First Party”, and , whose address is , hereinafter referred to as “Second Party”.
WHEREAS, the First Party is providing services for valuable consideration for the Second Party; and
WHEREAS, part of those services will require that Second Party shall make contacts with others, hereinafter referred to as “Third Parties”, originated and created by and through the efforts of First Party; and
WHEREAS, the First Party desires to create and originate those contacts with Third Parties for Second Party so long as Second Party does not deal directly with Third Parties to the detriment of the First Party; and
WHEREAS, the Second Party is willing to provide security to the First Party for that purpose.
NOW, THEREFORE, in consideration of the covenants and conditions set forth herein, the parties agree as follows.
1. The Second Party agrees that it shall not contact Third Parties without the knowledge or to the exclusion of First Party.
2. Second Party shall not enter into business relations or contacts with Third Parties without the express consent of First Party and without providing for compensation acceptable to First Party.

IN WITNESS WHEREOF, this Agreement was signed, sealed and delivered on the day of , 20 .

Witness “FIRST PARTY”

Witness

Witness “SECOND PARTY”

Witness
STATE OF COUNTY OF Sworn to and Subscribed before me this day of , 20 by
, who is personally known to me or who produced Drivers License Number , issued by the state of
, as picture identification.

Notary Public
State of
My Commission Expires:

STATE OF COUNTY OF
Sworn to and Subscribed before me this day of , 20 by
, who is personally known to me or who produced Drivers License Number , issued by the state of
, as picture identification.

Notary Public
State of
My Commission Expires:

33

I suggest that you check the legality of this form with your state, and fix some of the underline spots that I have, (some places have a line where it doesnt need it etc.) Its the basic form.

34

I have more deals, similar to the first one, posted on this forum.
I guess I cannot paste my web page address or it will be deleted? I have these, and would like to work out a couple of assignments before jumping in myself. I know what I have to do…basically… but would like to have a bigger comfort level before jumping in.
Is there anyone who wishes to take a look at these?

35

<<I guess I cannot paste my web page address or it will be deleted?>>

You got it! You an’t make “contact me” posts either, so this post is also a rules violation (not to worry, I’ll edit it for you!)

Keith
Moderator

36

I am in Michigan.

Chris

37

klopper,

Why would you make that post right after I just told another member in the open Forum that he couldn’t…??? Did you think that meant that only HE couldn’t?

Please tell me that your grasp of the “written word” is better than that!

Keith
Moderator

38

whats wrong with him saying that he is in michigan?

39

I said to much,however it’s just to say i do deals to.
So i understand.

40

It was an advertisement for his business dealings and was modified…

Keith