Offer with no way to find money?

Hey guys, I’ve been MIA cause I have been shuttin up and working on my REI. I found a home, the owners are real motivated the real estate agent really wants me to visit the home cause the owners have moved and she told me someones gonna get a real big steal on this home. I wanna visit it and if it fits my criteria make an offer, only problem…No idea where to find the moeny if they dont wanna finance or lease option it to me…


How many banks have you visited? How many houses have you looked at?


I havent gone to any banks because people tell me conventional loans are not the way to go because they will not 100% finance and charge more interest…

is that what you recommend tho?

The home was originally listed for 505,000, then 454,000 and now 439,000.

don’t know if the property is in calif or not, but from what i understand calif. lenders will make no doc 100% loans as long as credit is good. that means someone could lie about their income and still get the loan.

go figure

jpstephens, what do you intend to do with this property? The type of loan/lender will be dependant on your exit strategy.

Make the offer contingent on the sellers’ financing 100% of it. Then if they say no, there’s no need to panic since you won’t be in contract to buy a house with no means to finance the purchase. Of course, all your offers should include a financing contingeny, even if you have five bankers knockin’ down your door.
Contact a mortgage broker. A knowledgable mortgage broker is priceless, and I have made lots of money by finding the right one.

I plan on renting the home. One of many, I have a goal of 20 homes, 2 a year.

Then once the homes appreciate I want to sell half and collect rent without having to pay back debt cause ill pay off the others.

I, for one, have told you on several occasions to go out and meet with local lenders and to network at the local REIA – I think I even told you to dress up in a suit to meet the lender (I’m old but I vaguely remember this…) – now the time for the ‘rubber to meet the road’ is here and you haven’t finished your homework.

Based on your post, I’m guessing that this is a single family. If you buy this property for $400K+, how much will it appraise for? How much will it rent for? In my experience, you will need to get about $4-5K a month to be positive on the property (especially given the notoriously high taxes in in NY → freakin’ blue states!). Can you get that? Have you even investigated that? You were also told by several of of to really KNOW your target area. If you don’t know if you can pull this kind of rent for the property, you’re not there yet.

Just because you’ve found what you and your agent believe is a motivated seller and even IF you can get 100% financing, it doesn’t mean that the property will “work” as an investment property.

Just my $0.02…


But Keith, But Keith,

It was listed for $505K and is now ONLY $439K! Aren’t you supposed to base your offer on list price???

I don’t think market value matters - do you?

Surely it will be a good rental if the list price has been reduced! The realtor said it was a “steal”!

Banks don’t loan money cheaper than mortgage brokers - do they? (I’ve always thought that using a middle man saves money)

You don’t really need to know your market - do you?



ok no offense guys, i really liekd this forum in the beginning but people started flippin on me…you dont know if I’ve done my homework or not, and you dont know anything other then I tell you. I appreciate you help but am strongly turned off by everyones attitudes lately. I appreciate your help when you give it and thats why I coem back…don’t act like I dont take ur advice and dont do my homework cause I do.


There are a lot of people on these forums that are trying to help you. What I and they are seeing is you headed off in directions that have no correlation to what you have been advised by some relatively seasoned investors.

What I personally see is that you come in and ask a question, get an answer, then go off on yet-another tangent.

If this is your attitude (“i really liekd this forum in the beginning but people started flippin on me” and “I appreciate you help but am strongly turned off by everyones attitudes lately” – your words), then so be it…

That said, it seems that you now have some family backing (that’s a good thing) and are working with an agent (also probably a good thing) but because you’ve heard “motivated seller, motivated seller, motivated seller” over and over, you are loking the other way on the pertinent details of your potential deal.

No one wants you to fail…quite the opposite – I would prefer that you pass on a thousand losers or marginal properties rather than get into financial trouble with just one them…AND DON’T THINK FOR A MINUTE THAT IT CAN’T HAPPEN TO YOU!

Most of the advice that you’ve been given is sound and time-tested. You really need to ‘sharpen your pencil’ and look at what ownership will cost you and how much you can realistic get for rental income and then compare the two numbers…personally, I can’t see how this one, if it is a SFR can have a positive cashflow…

I would love for you to prove me wrong! Please get us ALL of the numbers and prove us wrong.

I personally don’t come in here to screw anyone over or to pi$$ anyone off (I go to the Washington Post forums for that!)…I can honestly say that I try to help where I can…BUT -----


No I understand and thats the kind of criticism I like…not the blunt mean spirited type. I have researched rents, and rents can get anywhere up to 3k a month for a single family and maybe even higher in my area. I am not saying this is a perfect property, and no one said I am moving in, its just a start and i wanted to show that I’m not just fluff anymore and am moving. Also I found a lender that is going to see if I qualify for 103% financing if I needed it…

I also haev the learning annex seminars this weekend, so I think I am goign in the right direction and not the wrong one.

The thing is my mind is very systematic, I work like a comptuer. Things have to be run like a system for me to fully work efficient. So far I have made call lists, then I want to call, then i want to screen, then I want to visit, then I want to crunch numbers, then I want to offer. Now that I have the financial backign and an understandign of lease options I feel a lot better.

I didnt mean to act like an ass this morning, had a bad morning. Lost my cell phone on the subway, and its gonna cost me 200 bux :frowning:

Hopefully REI will make expenses liek 200 bux seem like nothing tho!

JP. The short of it is you are putting the cart before the horse.

But yes, there has been an attitude on here. I think it started with a no credit no money down arguement.

Don’t take it personal. Look for the message in all the sarcasm. It’s quite powerful.


How does a person ensure success when starting a new business? The answer is very simple - follow a path that has proven successful for others.

The “attitude” that you are sensing is the frustration of those that have given you proven advice; only to have you act as if you didn’t hear it.

It’s interesting to me that Keith was able to say that the house you found won’t cash flow - EVEN THOUGH HE HASN’T SEEN THE HOUSE; HASN’T TALKED TO ANYONE ABOUT THE HOUSE; AND HAS LESS INFORMATION THAN YOU DO. How did he do that? That answer is that he used one of the “rules” for investing in rentals that have been presented to you many times on this board. For whatever reason - you didn’t get it! (This should be a clue to you)

You’ve been told by a multitude of people to know your target investment area! You do this by looking at houses. It is blatantly obvious that you have not done this. Instead of just doing it - you make excuses.

If you’re ever going to be successful in business, you’ve got to learn to quit making excuses; quit waffling; quit flailing; and totally accept responsibility for your actions (or lack thereof).

The key to successfully starting any business is to follow a proven path. Between the Carleton Sheets Course that you have and the information you’ve been given (totally free) on this site, you have all the information you need to succeed. If you can follow this proven path, you should do well. If you try to re-invent the wheel - you’ll end up like most wannabes - doing the 9-5 at your JOB!

I hope you make it, but truthfully I doubt it.


Excuse you, but how do you know if I have visited homes? How do you know if I have been comparing comps on MLS? How do you know anything about what I’ve been doing?


So i find it with great disrespect that you doubt that I will make it. Sure I ask questions, but you dont know the process that Ive taken and am taking.

So just how you think Kieth doesnt know anything about the house, you dont know anything about what im doing.

Thanks for the help when you provide it and I will continue to ask for it, but please do not put me down. I don’t take lightly to it.

Excuse you, but how do you know if I have visited homes? How do you know if I have been comparing comps on MLS? How do you know anything about what I've been doing?

We know what you haven’t been doing based on your posts - your own words. What you don’t say is more telling that what you do. For example, I asked you in the very first post in this thread how many houses you’ve looked at and how many banks you’ve talked to. You ignored the “how many houses” question and made an excuse for not talking to banks.

As a landlord, I earn my money deciphering what people are trying to say to me (reading between the lines). If an applicant asks if we do a credit check - they are really saying “my credit is terrible”. When you fail to say how many houses you’ve visited, that says to me that the answer is “few or none”. Am I wrong? When you say in your post that the realtor says that the property is a steal, that says to me that you haven’t done your homework or YOU would know if it was a steal or not.

It also speaks volumes to me that you come on here to ask questions and then are elusive with your posts. Instead of just responding to the questions, concerns, and observations that Keith and I have had, you respond with

you dont know if I’ve done my homework or not, and you dont know anything other then I tell you.

It would be much more productive if you would simply state the facts instead of playing silly word games.

I don’t know how you can expect to succeed with an attitude like that. Why even ask if you don’t want to hear the answer?

Here’s how your original post may have looked IF you had done your homework:

Hey guys, I’ve been MIA for a while doing my homework. In the time I’ve been gone, I’ve made up a business plan and talked to several lenders as Keith suggested. I’m approved for financing up to $500K. I’ve looked at dozens of houses and feel very comfortable with the property values in my target area. I went to my first REIA meeting and made several key contacts. I also met a great realtor who specializes in working with investors. She found a great property, here are the numbers:

ARV $300,000

Purchase Price $205,000
Repairs Needed $5,000

Gross Rent $2,500 per month
P & I $1,650 per month
Maintenance Allowance $50 per month
Taxes $200 per month
Insurance $75 per month
Vacancy Allowance $125 per month

What do you think? Am I missing anything?

Do you see the difference in this post and yours? This post says that you’ve done your homework and are ready to begin. Your post, well …


Thats the kind of constructive response that I asked for. Maybe I haven’t done EVERYTHING yet, but if you think I haven’t made progress from when I first started then your crazy. Listen I’m not looking for enemies and wont allow myself to have any its not in my nature.

Lets just learn to work together and I am taking steps to get financing preapproved.

Relax your mind, take off your defensive garb and read this thread all over again. These dudes are trying all ways possible to ensure your success at REI.
If your calling is in REI, do pay attention to what Keith and Mike have advised.


No I def am. I agree they are right, but to say I am not trying is a little unfair. I have increased my knowledge 10 fold in the last 3 weeks.