A New Day

Well, as many of you that follow me that work for Carlisle and Gallagher know, we work there No More.  For me, it's the beginning of a new day. When a door gets shut, a window is opened.  I know several of my friends at CG are struggling to determine what to do next.  I will be thinking and praying for them to make good decisions and work hard to find their next employment opportunity.  For me, I'll probably go back into the mortgage lending arena.  I still have my mortgage license and will see what opportunities present themselves. 
As for my real estate.  Now that I don't have a full-time regular job, my plan of buy-rehab-hold has been put on hold...somewhat.  When refinancing lenders want to see a current JOB for dtir's, or two year's tax returns if your commission-only or base plus commission.  So now my clock starts ticking for the next two year's, unless I get a full-time job with salary.  I may have a solution for it, and I'll know more by the end of today and will let you know about it.

PROPERTIES: Still looking.  I met with Net Worth Realty, a wholesaler, yesterday and let them know my buying areas and price ranges.  By last night they'd sent me a listing, which was in my neighborhood (they didn't know my home address, so it was a coincidence).  1976sf with an ARV of $299 (around $150/sf), purchase price of $175, estimated rehab of $50.  But I know my neighborhood well.  The package listed the 8 properties they used as comps.  When I pulled comps, I didn't get anywhere near what they were showing as a $/sf.  My ARV was coming in around $240.  When I compared the properties he used vs the ones I looked up, I saw several of my current SOLDS not on his list, and several SOLDS on his list not on mine.  I don't know why he left off the SOLDS I had, except for they were a lower $/sf.  When I looked a copies of the MLS listings on the sold properties, I noticed the sales dates of many of them were March-June of 2012.  Lesson:  These comps are 8-10 months old.  An appraiser won't go back that far unless he has to because of no recent sales.  In this case, there were plenty of recent sales.  They just weren't at a higher price/sf.  So this is where you need to be careful of people like this and do your research and homework.  We were going to look at the property at 7:00am but he cancelled while he researched his property acquisition specialist's numbers.  I'll be interested to see what he comes back with!  I told him that for me to make a profit on the house I'd have to buy it at around $120,000 not $175,000.  I'm sure they won't take that, and they'll just wait for some other idiot to believe their numbers and buy it at $175,000 and then take it in the shorts when it comes time to sell it.  It just won't be me.  It's hard to be primed and ready to buy and move forward and then have to stifle on each deal because it isn't right. But that's why you work the numbers.  I've been through the stress on a couple of properties that were close to not selling within my needed time frame and were about to cost me much more than I had budgeted.  Fortunately, I dodged that bullet.  But the closeness of the bullet, and the fretting and sleepless nights I remember cause me to take pause and Make Sure It's Done Right at purchase.  If the numbers don't work, then don't move on it, move on to the next property.  You will be glad you did!  I'm still in the hunt for this house, but not very confident about it.

Today I'm looking at two properties in Plano with Justin that were under contract but have fallen off.  One, on Santa Fe Trail, looks promising.  I've verbally offered an amount about 25% less than the asking price.  The seller's agent has not rejected my lowball offer, just assured my agent that there's no option period, and if I balk on buying it I'll lose my earnest money.  Not a bid deal.  I'll look closer at it today.  I've estimated about 20,000 for repairs on a 1565 sf house, so unless it's a real mess, that should be enough.  We'll see today.  We're also planning on visiting Gwendola in Plano.  I'll let you know how these visits turn out.

OTHER: Continuing education with a Seminar tomorrow morning.  Titled "The Flipping Formula" at the Doubletree Hilton at Campbell Road and Central in Richardson.  Starts around 8:30.  I'm sure it's a sales pitch, but I may make some good connections.  I go to these things, and take a lot of business cards and do a lot of visiting.  I also continue my education by paying $67 to buy Carrie Wilbur's "Rehab Renegade" series.  All online, one time charge.  A lot of stuff I already know, but reviewing pdf's and listening to audios and video's keeps my mind alert to every aspect. She charges $97 for the course, but if you "leave the page" she'll try to keep you by offering you a $30 discount.  After several on the page / leave the page attempts, I realized this was her lowest offer, so, for $67 it isn't a bad deal.  I'm working through it now. There's a lot of "systems" out there that are cheap, like this one. Take them for what they are.  They'll tell you how you'll be making $10,000 a month.  Mostly, they're education, so they'll be cheap and good.  This one will take me awhile to get through, but I've already picked up a few "nuggets" so it's worth the $67.  I'm also looking at Cris Chico's "make money with only a laptop and cellphone" system.  I think his is only $47.  I emailed Carrie and Cris about any "upsells" once inside.  Both have a single upsell attempt inside, but Carrie's is for continual mentoring and coaching calls, for a monthly charge.  I passed on them. If you want to check out her system Click here to find out how.  I don't get any commission for this, just passing on information.

Until next time...

Mark

8 Properties

Saturday update-
I had a contract accepted by the owner on a short sale.  2235 Jackson Circle in Carrollton.  I decided to go see it. It's a townhouse, that's attached to another unit.  Basically, a duplex.  I don't like duplexes unless I'm getting the whole property.  It's typical...one unit is tore up, foundation sagging, garage door pulling away, house has already had foundation work done and the same area is having problems.  And the poor people that are duplexed to the bad property are suffering because their "attached" neighbor can't/isn't taking care of his property.  I don't want to be on that same side of the situation, so I'm out on attached properties.  I'm not in total control.
Next house was 1514 Hindsdale Drive, Richardson. House looked nice, needs some foundation, but not a lot.  However, numbers don't work well on it.  I offered $78,050 and house will ARV around $115,000.  After about $20-$25,000 of repairs I'm in at about 78%.  So I'll either have to reduce my offer to around $68,000-$70,000 to make it work.  This house was my favorite.  And I'm still keeping by eyes on 652 Spring in Allen.
Back in Carrollton, we went to 2645 Via Sonoma.  Again, a townhouse attached to another address...a duplex. I'm out.  Also, a short sale, so too long to wait.
So Justin and I have Pioneer Lane, E Park Blvd, and Gwendola Drive left to hear from, from the original 17.  I also met with Lisa at 2609 Province Lane, Dallas,  in East Dallas,  asking $48,000.  The house was really cute on the outside.  Once inside, we found out the foundation was a mess, as you went on a roller coaster ride as you walked around the house.  And it was chopped up on the inside.  And they enclosed the back porch to add a "master bath".  Not even a bargain at $30,000.  So I passed.
I'm back looking at other properties.  I didn't meet my goal of getting a property by the end of the year.  But it wasn't because I didn't try.  And I won't stop.  Persistence.
Tomorrow is New Year's Eve, so if any of you are making plans to be out celebrating, please be careful and drink responsibly so that we can all have a great year in 2013.  My goal for this blog is to start including photo's and video's with the blog, once I mast that.  If any of you are good at it, technically, then please let me know. I'm willing to make the effort to take the pix and upload them if I just know more.  I will attempt to do it the best I currently know how, and we'll see how it goes.
Happy New Year!

Mark

Multiple Offer Update

Several of the 15 properties Justin and I are working on are under contract, one was an auction, and another required me to get pq'd with Nationstar. When the dust settled there were 8 props left. Last night I signed and dated all eight contracts. Justin will be submitting them today. Then we'll wait. Meanwhile, I found a property on Province drive in East Dallas. Asking price around 48k. ARV is around 75,000. The owner of the property is a life estate. I will hopefully be looking at the property Saturday depending on Lisa's schedule. The estate might be willing to negotiate, and the numbers look really good. Rent-$1,100; gross equity - $21,692; cash flow $457/mo; estimated rehab costs-$12,000; est. COOP-$1,123; mos to recover COOP-2.46. I'll let you know how it turns out.

HUD properties

The two HuD properties that Jason submitted were rejected. We're now working on the other 15 that are bank REO's and should have a lot of them submitted by the end of today. Btw, my offers were rejected but it appears that one of them did not receive an acceptable offer and is still on the market. I'll re look at that one to see if it's worth revising my offer.

Update on 17 properties

Justin received my email to place contracts on 17 properties. One is already under contract. So now there are 16. To avoid me from having to write 16 earnest money checks and 16 option fee checks, I took pix of two blank checks with my signature only. Justin will make 16 photocopies of the blank checks and then he can fill in payee and amount for each contract. He uses docusign so I could electronically sign 16 contracts. But I would prefer Justin add my initials and signature to the contracts so I don't have to. But docusign works through my email address. I could give Justin access to my email address password so he could email me the contracts then go into my email account, sign them, then sign out. But i dont want him accessing my personal email account. Instead I set up a new gmail account to be used specifically for these transactions and gave Justin the password. Now he can send the docusign dox to that account, then he can go into the account and sign them for me, and then receive them back. I'll still have copies of the contracts in my personal docusign account. Justin has 2 HUD contracts to submit before midnight tonight. We'll get to the others this weekend. Christmas? Busy. Merry Christmas to all of you!

Shenandoah update, BofA, New Strategy

Shenandoah-the lender didnt like my offer, and the stated that there was an offer pending. Christie - is a BofA property. Note: BofA requires all bidders to he prequalified by BofA. Even though I'm an investor and paying cash, they want to pull my credit, see my paystubs, and complete a 1003. I asked the LO if she could waive the pQ based on my information. She said no. I told my realtor to submit my offer anyway with an explanation re the missing BofA PQ letter. We'll wait and see.
Justin sent me a list of 34 properties from the Richardson/plano/McKinney/farmers branch area. I cruised through and selected 17. But I decided to take a different approach. On a spreadsheet I put all 17 properties with asking price, then Zillow estimated market value. Then I added a column toff the tax value then another column for my market value per a market evaluator I use on InvestorBlock. Then I determined an offer price, property unseen. I sent the spreadsheet to Justin and told him to write up 17 offers (only one was a HUD property. The rest were individual owned or bank owned). Then I'll see what comes back. Probably counter offers. Then I'll visit those properties and determine the status of the counter offer. That way I don't visit 17 properties (gas and time) and I'll see who's serious. And I can use my option period to back out if I want to, or to amend my offer based on my inspection of the house. Yes, I may miss some good deals. But I will have a better chance of making a good deal on a good property. And I'm only trying to get one house right now anyway.
Any comments, let me know. Questions? Maschellhammer@yahoo.com. And please be sure to let a y of your friends or acquaintances that might be interested in real estate to subscribe by email to my blog and watch me as I go through the process of finding, buying, rehabbing and renting/selling a property. The more people we have involved, the better.
Mark

House Hunting

I looked at 4 houses this evening with Justin Miller with Keller Williams.  First house on W Spring Creek in Plano was a dog, too many foundation issues.  The second house on Shenandoah in Plano was a really nice house.  Occupied, it's a short sale.  I normally don't like those, too much paperwork.  But I told Jason if he'd do the paperwork we could put in an offer.  Market Value is around $125-$130.  Asking price is $106.  To get to 70% I need to be at $91,000.  Not a bad offer compared to $106 asking price.  I offered $60,000.  I can always come up to a counter offer.  And, being a short sale, it will probably take months.  We'll see.
Third house was on Spring St in Allen.  Bigger house, 2,273 sf, two-story, but a 4-bedroom.  Minor foundation problems, inside was nice.  New flooring and paint.  A few patch areas in the drywall, and a leaking bathtub upstairs causing an issue on the ceiling downstairs.  And speaking of ceiling, popcorn.  Biggest issues are redoing the ceiling, all new windows (all have lost their seal) and exterior siding replacement.  All is MDF board, not that good for long term.  I might consider redoing the whole exterior in hardiboard.  Expensive.  But the numbers.  ARV on this house could be $190-$200.  Asking price right now is $99k...already at 50%.  I'll offer $75k.  If I get it for that I'll put around $35k into the house and should flip this one for a profit of around $50-$60k.  If I rent it I would cash flow around $700/month.  But this house I would probably flip and get my cash out now.  It's owned by Bank of Oklahoma so, being a small bank (meaning, not BofA or Wells, etc) they may be willing to part with it quicker. We'll see what happens.
The last house was in far north allen, and was not worth the drive.  Small wooden house, 1,500 sf, reworked duplex, window a/c's, gas jet heaters (i.e. no central heating or air), two kitchens, a mess inside.  A total gut and redo, which I'm not into right now.  Also, not in a great part of town.  I passed on this one.
So house 2 and 3 get offers.
Tomorrow I look at two more houses with Vance, in Carrollton.  I'm working the initial numbers now, but will finalize them by tomorrow night and possibly submit offers on them.  Anyone who wants to accompany me to these two houses is welcome to join me.
With Christmas looming this weekend, I'll work this until maybe Thursday, then chill until next week on my return to Dallas on Wednesday.  Please be sure and call or email me if you have any questions.
I will try and take some pix in the future of the houses I'm looking at so you can get a better idea of what I'm looking at.