Good Afternoon,
Wasn’t sure which board to post this on, so my apologies in advance if it should be somewhere else.
I’ve been reading the RE boards for months (actually spent this entire weekend reading all 103 pages of the financing and hard money forum). I’ve done the online seminars and read some books suggested on this site. I also have somewhat of a mentor in the person I am “attempting” to bird-dog for and have spoken with several other investors.
I feel like I’m ready to get out there and do something, however I have some major challenges and would like some advice. Here they are:
• I am currently making $81K at my job, however, I will be downsized this Friday, 12/08/06.
• My husband and I just built a $500K house that we closed on 10/04/06.
• We currently own a townhouse which has been on the market since 03/30/06 and not sold. Because we were planning on using proceeds from the townhouse to buy the new house and couldn’t, we had to secure creative mortgaging (80/15 Interest only with higher interest rates). The townhouse is now listed at about $5K below comps in the area with a brand new kitchen. Also having an open house on 12/10/06 and have enlisted the help of a mortgage broker friend who is offering some great financing for buyers to sweeten the pot. Also offering a $1K bonus to the selling agent and assistance with closing costs. Don’t know what else we can do!!!
• Up until a couple of weeks ago, my husband’s mid-FICO score was 680, mine was 622. All three scores are now 660, 630 and 611 and 632, 613 and 568 respectively, because we applied for a couple of credit cards after the mortgage was processed.
• We had $12K in our bank account and were told by the mortgage company that the first payment on our new house would be 12/01/06. We get to closing and find out that it was 11/01/06, which caused us to lose about $4K of our savings.
• With me being downsized, and having to pay two mortgages, we will have to start dipping in our retirement accounts by 02/01/07, if we don’t sell our townhouse. If we do sell the townhouse, we will have a couple of “cushion” months if I don’t find employment.
So… that said, here are all the thoughts that have been running through my mind:
• I have been trying to bird-dog in the central New Jersey area for a couple of months, with no success, mostly pre-foreclosures. I’ve done cold-calling, door knocks and bandit signs. I’ve also been to a couple of Sheriff’s Sales to see how they work.
• Even though I know that most of you on the board recommend bird-dogging first, I realize I could probably double my profit if I wholesale and profit more if I rehab.
• I’m already feeling overwhelmed, now having to pay two mortgages with the bank account draining fast, and now, don’t have any funds for down payments.
• I guest my first thoughts are that I should go to a hard money lender to try to do a wholesale deal or a very simple rehab to get started. I realize that me not having a job after this Friday, will not be appealing to conventional lenders. Even though I’m overwhelmed with everything that’s going on, I feel driven to do something to get a large, lump sum of money in the bank in the next 30 to 60 days.
I guess what I’d like to know is do I just sit and wait and hope the townhouse sells in the next couple of months?
OR
Do I contact a hard money lender having no job to try to make something happen now? The reason I am tempted to seek out a simple rehab is because it should bring in the most money, but because I’m a newbie, I realize the risk of me messing something up and losing money. Since I’ll be free after Friday, I am ready first thing Monday morning to hit the ground running to set up financing and go looking for deals.
Okay, I’ve probably rambled on long enough, but I wanted to provide enough information to receive good advice. I hope I haven’t left anything out. Any and all advice is GREATLY appreciated, as I am in a quandary about my next move. Thanks in advance to all replies.
NJ-Investor