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Posts Tagged ‘invest in real estate’

Hello Everyone,

Hope everyone had a great Thanksgiving.  It’s back to work!

A couple weeks back, we made an offer on a great 3 family nearby.  It was recently rehabbed and de-leaded, rented with long term tenants and it also had a parking lot for extra income.   The cash flow would be at least $800 a month, depending on our financing.  We made a first offer of owner financing at 8% with a 10% downpayment (I looked at the on-line deed records and I thought the seller may have owned it outright).  The seller came back and countered with non-owner financing, he countered pretty close to asking.  We countered again for about 11k under asking. The seller came back asking about $6k under asking, but we said our last offer was highest and best.  We haven’t heard back, so I assume he’s not interested.  Our Agent told us that they also had another offer on the table, for the same amount (as our final offer).  Interesting, huh?   This one would have been great, but we’re not going to overpay.   The seller just bought this house back in April for $215k and wanted to sell quickly, but I guess he didn’t want to sell that fast enough, since he has it listed for $239k.   And I just got word that the house went under agreement today.  Another one bites the dust (cue the song).

Oh, and one of the REOs we made an offer on a while ago is back on the market again.  This means the property will be on the market close to a year and a half…and they wouldn’t take our offer?  These banks are really ridiculous.   I guess they want to go through another winter with maintenance, snow removal and the risk of  frozen pipes. 

In the process of looking at this deal, we talked to a lender about conventional financing for rentals. I knew this was a waste of time, since we are down to one income since my husband was laid off.  But, the guy I talked to was nice and suggested just going with my income, since I have long term job employment.  He was impressed by my (and our) high credit scores, but said my own debt to income ratio is too high to buy a rental, which I know, since we already have a mortgage and other bills.   But, I did talk to a couple of other hard money types that have been helpful.  There are some awesome people over at BiggerPockets.com (BP) that have been great.  BTW, if you are not a BP member, do join, it’s a great place to learn and connect with others.  The main sticking point is that we don’t want to take all of our reserves to use as a 30% (or more) downpayment, since that is a significant amount of money here with our local real estate prices.  So, I gotta figure out a way to make it work. I’m a little stuck in the private lending department, too.  It’s a long story, but with my 9-to-5 and the work I do, I do have SEC guidelines I follow with my day to day job, so private lending on the side is really not possible.  I need to find a way around this…I think I’d be ok with lenders with whom I have a previous relationship, but to seek out new people I think would not be possible.  I am still loving the PMBP course, and I knew my job would be an issue, but I may need to hold off private lending until I leave the job. 

So, in the meantime, we are still looking at REI and other ways of making passive and not-so-passive income…like getting back into eBay and stuff like that.  Anything we can do to make enough to pay our bills (to reach our “number” found in Shae’s Financial Freedom GPS), is what we need to do.

That leads me to my goals for next year.  I really need and want to be out of my job by next summer. I am willing to do anything I need to accomplish this.  I just wish all these things I want to do wouldn’t take as long as they should to happen!

Happy Investing!

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Still no word on our latest REO offer. I think at this point, the bank’s listing Agent is trying to string us along.  They still haven’t given us the status on the Title V (septic) testing, which happened over 2 weeks ago.  And he has since posted about 16 photos of the property to the listing  (there was only one lousy photo on the listing previously).  No price drop yet, though. I think he wants us to back out so he can get a full price offer from a homeowner.  Hey, maybe he can…but you’d think they’d consider any offer since it’s been on the market 390+ days. Oh well.

The rental property lead I got from Craigslist won’t work out, I don’t think.  He wants about 50k more than it’s work, IMHO.  I got a couple new calls from our July inherited property mailing (and we still have more letters to send).  So, I hope we can get a deal out of one of those leads.  I’ve been waiting to mail the last batch since those houses are in a more depressed area in our county, about 45 minutes away.  I think if I buy these leads again, I’m going to pick and choose the cities closest to us, rather than the entire county.   With working a full time job and having a family, it’s hard to make appointments as it is, nevermind if the house is 45 minutes away.

And in the meantime, we’re still looking at more REOs. We looked a two on Friday and we’ll look at two more tomorrow.  Something’s gotta happen in the way of a deal soon, right?

I’ve also started writing down goals. I had done this in the past, but not for a very, very long time.  I’m hoping if I do it this time, they goals will come to fruition.  I also made up an index card of some goals and “quick hits” so I can look at them daily.  I also am really trying to make it so I can leave my job by next July.  Maybe if I say it out loud enough times, we can make it happen.

Today I got my PMBP course in the mail. Yahoo!  I cannot wait to check it out.  I was listening to the modules on-line in the meantime.  Speaking of PMBP, have any of you with the course used the “private money getting” website to obtain private lenders?  If so, how is that/did that work out for you?  I know the SEC rules are tricky, so I want to be sure to follow all the guidelines (especially since my full time job has to do with financial services so I cannot cross those lines in any way).  

I also got my Steve Cook Flipping Home Bootcamp CDs (not DVDs) that I won from re-naming Scott Costello’s blog so I want to listen to that course, too!  

That’s it for now.

Happy Investing!

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I’m so glad September is here.  Even though it’s back to school time, August wasn’t nearly as productive as I’d hoped.  Since we pulled the plug on our REO offer, we had to start all over looking for more deals.  And we also got a little off track due to another family funeral. 😦  The fun never ends around here!

We did put in another offer on an REO yesterday.  It’s a cute little 2 bed/1.5 bath house that needs (from what we can tell) mostly cosmetic rehab.  The septic system inspection has to be done, though, to see if that needs replacing.  Anyway, the house has been on the market over a year, I think partly because the MLS listing photo (only one) is just awful.  The picture doesn’t do the house justice at all.  We offered about $80k below asking price (it’s listed at full market value, which is ridiculous).  The bank I’m sure will reject the offer, but let’s hope they counter with something reasonable.  I hope to hear by mid-week on the status of that offer.

I’m still getting calls from our mailing (we still have one more batch to send).  The one guy keeps calling and calling.  It’s an inherited house and he owns it with his siblings.  The house was listed since  June at over market value (listed at $249k, it’s worth about $200k, maybe).  I told him that we’d be willing to come see the house, but we couldn’t pay close to asking.  Well, the listing expired 8/31 so he keeps calling before they list the house with another agent.  From the MLS photos, the house looks in nice condition, just outdated.  I did also ask him if they’d be interested in owner financing, and they don’t want that, they want the cash.  What would you do?  I think he’s motivated, but if they still want close to asking, it’s not a deal, ya know?

Oh, and Steph over at flipthiswholesaler.net instituted a do-over for her 30 day challenge.  Thank goodness cuz August was a sucky month for REI.

Happy Investing!

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True Hard Money

Image by madmolecule via Flickr

Well, it’s been another interesting week.  After much discussion, calls, emails, etc. regarding the REO offer we submitted, we decided to move onto another deal.  I’ll try to make quite a long story short. 

Our Agent had submitted our offer – the P&S, $1000 earnest money, pre-approval letter, etc. to the listing Agent for the bank.  Right after submitting the offer, the listing Agent said he couldn’t submit the offer to the bank with our pre-approval letter.   Personally, I could not understand why he would not submit the offer to the bank…they were probably going to counter our offer anyway.  Our rehab (hard money) lender provided me another letter, which I submitted to our Agent. She said the listing Agent didn’t like this letter either, since the letter didn’t mention the downpayment amount.  I got in touch with the lender and she said that she couldn’t note this amount (or %) in the letter yet, it’d depend on the final accepted offer.  Makes sense to me, but the listing Agent wouldn’t have it.   We tried to explain that the offer price will likely change by about $30k if the house didn’t pass Title V (septic) inspection, which was likely.  All this still didn’t matter…the listing Agent said they wanted a letter from a “direct lender.” 

So, in the past week, I talked to a couple other different lenders and got lots of helpful info.  Also, when I talked to my original lender, she mentioned that on occasion, some banks don’t accept her letter, because the bank think she’s a broker, which she’s not – she does her own loans.  Then the listing Agent suggested we offer to put more money down.  That’s when I really started to get annoyed.  Why are they asking for all this stuff when they haven’t even submitted our offer to the bank? 

After much deliberation, my husband and I decided to pass on this one.  If the bank was going to give us this much hassle to submit an offer, what were they going to do afterward?  We didn’t see the need to jump through all these hoops when there are so many other houses out there.  On to the next one. 

Have you ever had such difficulty submitting an offer on an REO?  Did you ever have a valid, thorough and very detailed pre-approval letter get rejected? 

Happy Investing! 

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[tweetmeme source=”stealthreinvest” only_single=false]

Hi There!

We’re still chugging along looking for rehab and wholesaling deals.  We looked at a few more REOs this week.  One house was a great find – just listed colonial, built in 1990 (yeah! no lead issues), that needs a complete cosmetic rehab.  A few other minor things like some missing copper need to be fixed.  The house is solid, good bones.  It’s in a great, highly desirable town (where my husband grew up) so we know the area really well.  The only downside is the house is on a busier street and no garage, but I think we could rehab and price accordingly.  I went by myself to see it so my husband is coming with me again to see it today.

One of the other properties was in an awesome neighborhood – quiet street, beautiful lawns, older homes (built in 1950s/1960s), but it was such a great area, typical “pride of ownership” shows here!   It’s the proverbial “worst house in a great neighborhood.”  The house was fully gutted inside and we knew the reason why the minute we stepped inside…it reeked of cat pee.  The smell was unreal.  The house had been sprayed with a white substance (I assume some type of odor killer) and everything had been ripped out (kitchen, most of the floors, etc.).  The cats must have urinated everywhere (although the basement and 2nd floor didn’t smell as bad as the 1st floor).    I cannot imagine what it smelled like before a lot of stuff got ripped out.  The house was built in 1950, and beyond the complete gut, needs new windows, new exterior paint (or siding), etc.    My husband actually liked this house…it’s way overpriced,  but if we could get it dirt cheap (which is possible) it’d be a great deal.  I’m just worried we couldn’t get rid of the smell.  What do you guys think?  If we rip out the sub-floor, and again use odor remover stuff (like Kilz), can you get the smell out?

BTW, I had a gut (no pun intended) feeling about the cat pee house, so I Googled the address.  Turns out, the house made the local paper because almost 50 cats were removed from the house at the time of foreclosure.  One of the neighbors in the article mentioned you could smell the odor across the street.  How happy do you think the neighbors would be if we rehabbed that house??

Also, we’re still getting calls from our direct mail campaign, and we still haven’t mailed all the letters.  This week I got a call from an attorney (property is listed already), one from a Realtor (property is listed already), one from the owner’s son (property is listed already – overpriced) and one last call from another investor.  He must have it under contract, but didn’t say that in his voicemail…I called him back yesterday (after I Googled his phone number) and mentioned I noticed he also buys houses.  I’m waiting for him to call me back to see what he’d want to sell it to me for.  It’s a butt-ugly house (from the outside) that he said hasn’t been updated in 40 years (we haven’t seen the inside).  We may have a deal if he can sell it to us cheap enough.

Happy Investing!

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[tweetmeme source=”stealthreinvest” only_single=false]

I wanted to give a quick update on our inherited property mailing list results so far.  We still haven’t had the chance to mail all the letters yet (we’ve mailed almost 200), and we’ve already received about 11 calls so far.  A couple people left messages saying they weren’t interested in selling, but were very nice about it.  The other new calls received were about a couple properties already listed in the MLS and a couple new (unlisted) leads.  The hard of hearing guy, and his son, called back again, too!  We’re going to follow-up on these this week (I’ve already left messages for some to call me back).  I’ve been very happy with the number of calls received from this list.  Maybe it was the fact we hand-addressed and stamped the envelopes?   We really hope the mailing results in a deal…and if it doesn’t this time around, maybe it will when we re-mail to this list in a few months.

We also looked at a few REOs on Monday…looking for some rehab/wholesale deals.  However, the rest of the week was very unproductive REI-wise, since we had relatives staying with us to attend a funeral.  So, we gotta get back into the swing of things starting tomorrow.

Happy Investing!

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[tweetmeme source=”stealthreinvest” only_single=false]

Hi Everyone,

Thought I’d give an update on our activities this week. 

On Monday, I had the day off from work so my husband and I took a drive by about 8 properties in the area, mostly REOs, that thought might be good wholesale prospects.  We were planning to see one of the HUD ones yesterday, but the broker didn’t get back to me.  Lots of good deals there, for sure, just not sure if I can get them cheap enough to wholesale.   Oh, and one interesting thing happened.  We took a look at this REO that was out in the middle of nowhere…it was 45 minutes away and really rural.  Anyway, we finally get there and pull up to the property (funny, we could see all the houses on this street on Google Maps except this one) and it was set very far back and behind a fence and then some shirtless dude (son of the owner) comes up to us, telling us to get off the private property (cue the Deliverance music).  He was giving us some song and dance about the property not being for sale, tell the bank it isn’t for sale, blah, blah, blah.  Well, we didn’t know if the dude had a gun or whatever, but we got the heck outta there, we didn’t even have a chance to take pictures.  So, I emailed the guy at the bank I was working with and told him what happened and never heard from him again.  Weird, cuz he had been emailing me all week, asking if I had checked it out yet…he is out of CA so his company hadn’t had a local rep out to see the property yet.   As much as we are looking for a hot deal, I’m not going to deal with that much drama.

I also have been doing more to build our Buyers List.  I have been also calling other investors’ ads to get them on my list.  One guy advertises in our local paper daily looking for multis to buy.  We’ve been playing phone tag for over a week, but I want to talk to him soon to find out exactly what he wants and get properties under contract just for him.

Lastly, I had been trying to get my makeshift probate list together…it’s been taking forever.  I’d been looking up public records data on-line and then trying to find the Executor/PR and then seeing if there is a property available, also using public on-line data.  I also have checked out the Probate Court records, but since that office is 45 minutes away and closes pretty early, I don’t get a chance to get there myself very often.  I may outsource going to Probate Court at some point.  Anyway, I got a good tip from Shae Bynes from goodfaithinvesting.com.  She talked about an inherited property mailing list that she used for marketing (this is the 2nd time in a couple months I’ve heard about this type of list).  So, to make a long story short, I bought the inherited property list from a list broker.  This list broker supposedly sells only 2-3 people per county, and there is no one else in my county with the list.  There are about 250+ names on the list, so I’m going to send out those letters soon.  I was going to outsource that to click2mail.com or something like that, but my husband and I are trying to keep costs down so we are printing the letters ourselves and writing and stamping them by hand.   (BTW, if you haven’t head Shae’s success story on flipthiswholesaler.net, check it out.)

Happy Investing!

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