OfflineGreetings all,
I just wanted to drop a note about what can happen if you are impatient.
I got tired of reading, I got tired of studying, so I decided what else was there to do, but go buy a house. Last week I found ads from what appeared to be REO buyers who were doing fast flips in my area and started doing drive buys to take cursory looks at about 15 properties and built a short list of 6. Since I was still learning about REOs I decided to look for properties that others had already bought from the banks.
With my short list in hand and no patience for more books, I looked each property up in the county tax records on the internet and found the transfer prices. This told me how much the investors had paid for the properties and also gave me an idea of the profit they were looking for on their deals. I saw that one of the investors was obviously looking for very high volumes of flips with what I felt was a very fair profit margin for his work. I also noticed 4 of his houses were on my short list, which definitely brought a smile to my face. I went ahead and called him and got access to the four houses I wanted to look at (all lock boxes, to which, he gave me the combinations to). Since the investor was out of state, he had actually seen none of the properties himself and was working from reports from local people he had video taping the houses. After looking at all four I found the one !!!
The house had long uncut grass, the screen door was rusty, one step inside and the nose was assaulted by old stale smells, and the eyes burned from the ten colors of paint on the walls BUT once the nose adjusted the smell and I put on my sunglasses, the truth became clear. The house had NOTHING wrong with it. About ten gallons of paint, rip out the carpet to expose the perfect hardwood floors below and some deodorizer and the house is ready to move into.
To keep things in perspective, at this point I had about 5 hours invested in the whole thing, not bad at all.
After looking at the house I decided on I used the tax records to see what he bought it for, I also Googled the address and found that it had been on the market for about 60 days, to me a long time for a wholesale flip.
So i decided to take a gamble and make my offer. The houses on either side sold for 45k and 43k within the last year or so, the FMV on this property is about 38k to 42k after some paint and grass cutting and I knew what the owner had paid the bank for it, the internet will provide.
The offer----10k.
Well the owner nicely told me he did not think that that would be acceptable and that he had several people looking at it over the weekend and he would call me next week. I was sure I had lost the deal, but I also thought the owner was making a fair profit and stuck to my offer. Four hours later he called back and said we have a deal if I will sign on Monday and give him a 1k deposit. I am not sure what happened, but I am thrilled I did not offer the asking price and took the gamble. I agreed and told him I would be there.
Now the problem was, I had no idea what I was doing and only went shopping out of impatience. Well, I called the academy folks who I had signed up with and told them the same story, also saying that I would love it if they bailed me out of my impatience, which they did wonderfully. A couple hours on the phone, they even looked over the contract for me, pointing out some items to review, I could not ask for more, they were great.
I do also want to say that while I said I got tired of the books, I had also read all of Dean's books twice, but was suffering from paralysis by overanalyzes. Without the books, the web site, and the academy, this would not have happened.
So after this terribly long post, the end result is I bought my first property, hope to make 15k to 20k on it and and extremely happy.
The moral is: Get off your butt and do something, I wasted three months hesitating and hate myself for it!!!!!! I sit and wonder how much I could have made in those three months, well I won't make that mistake again !!
David
Good job! I am very happy for you. Let us know what happens on Monday when you sign. Good luck!
Jeremy
This train, Dreams will not be thwarted
This train, Faith will be rewarded
Big wheel roll through fields where sunlight streams
Meet me in the Land Of Hope And Dreams
Bruce Springsteen
Hi David,
Just wanted to say congratulations on making the step towards a future of many successes! Congratulations again...........Lubertha
"GOD IS STILL IN CHARGE, HE IS THE AIR WE BREATHE"
Hi,
It is a game... The way i see it,Maybe that is what has been holding me back!
Maybe it is time for me to push ho$or away and...Run the numbers!
That is my take,Help run the #'s
Invest in yourself!
Hey all, thanks for the positive response
I will admit when I went out looking for properties, my first approach was to be satisfied with a property I thought I could make 1k or 2k on, and at the very worst, not lose money. I thought if I did not do something, I would never do anything. The more I looked though, the larger the profits got until I found this one.
Like I said, about 5 hours invested to find it and I am confident if I do nothing but cut the grass, plant a flower or two, tear out carpet and paint, all in all way less then 1k invested, I can make excellent money on this.
The hard part ACTING, not THINKING about acting.
Great job indeed. Unless we just cast that net we wont get any fish. Wish you much success in the future.
Cheerss!!!
Viliame
I'm a newbie too and was just thinking I'm starting to get a little anxious and wanting to get out and get started!!! You're an inspiration to me! I thought the story would end badly; but I'm definitely glad it didn't! Thanks for the post! And thanks for "getting off your butt and getting moving"! Another inspiration!
I have just about let the same time frame lapse as you did, and I am hating myself on the inside. I drive by places and can't pull the trigger. Thanks for the inspiration, I'm leaving the house now to go look at more. Keep up the good work.
Eddie Kilthau
Phoenix, AZ
Eddie Kilthau
Phoenix, Arizona
602-697-1978
I read your story and it sounds like you got a steal... not just a deal, which is what I like to look for!!!! When you guy so low, your profit margin doesn't have a choice BUT to be 10K+! Keep on truckin, SELL THAT HOUSE!!!!!!
djdebrill
An easy way to start, just to get your feet wet... Pick up the newspaper, create a buyers questionnaire, and call a few sellers. Get used to talkin about buying someones home, it makes snatching that deal up that much easier! Hell the questionnaire is in the book lol!!!Just pick out a few questions that'll become your niche when you talk to them, I know I don't use every question. And the even MORE surprising is when you accidentally call up such a motivated seller, they'll be MORE THEN HAPPY to sell it to you, so long as your creative... which you can get ideas from the book. heh I like calling it... the book.
Profit From Real Estate Right Now
Knowledge is Power
- Pimpedoutgeese
Allow your fear to gently pass. Then genuinely ask yourself,
“What needs to be done?”
.
Allow your fear to gently pass. Then genuinely ask yourself,
“What needs to be done?”
sorry. nasty triple post
Allow your fear to gently pass. Then genuinely ask yourself,
“What needs to be done?”
Congratulations on taking action and finding a great deal. This deal sounds like it will work out well for you. Good luck with REI and thanks again for sharing your story. Believe and Achieve!
- Joe
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Great story and great ending! I know exactly how you felt.......I have been feeling the same way. Now is the time to get going and make things happen.
Reading the books will only get you so far. You have to go out and just do it
as you did. Whatever happens happens.
Thanks for sharing your first deal story David. It gives me the motivation to
just make it happen too!
Jim
BELIEVE IN YOURSELF!
I can't thank everybody enough for the positive comments, its always nice to know others are with you.
But now is no time to rest. Assuming all goes well, tomorrow I sign the contract, but no I refuse to wait until closing, wait until I do a little touch up and wait to flip it. A realistic time frame could be two months for everything to happen, so the question is do I sit on my butt for two months waiting for the money?
NO!!, again too much time wasted now, its time to go find another and get it closed too!!
I also wanted to let you know how I decided to pull this off.
I read the books and really decided to look at my resources, look deep and I found my 401K. I had not paid much attention to it other then to see it loose money. I was not allowed to cash it in unless I left my day job, but I was able to pull a loan on it. I pulled as much as was allowed and set up a repay over 10 years, this basically gave me 10k to work with and enough to do this deal. The problem was I wanted more then one deal, so I went to talk to a friend and explain what I was up to. He also saw the same problem and decided to pull a loan also. Together we bought the first house and also now have enough money to go find a second since we have double the cash. It should be a great team, he is an excellent handy man and I am decent with handy work and paperwork. The repay on loans is about $35 bucks a month, skip McDonald's a few times and one does not even notice.
So the next step is to find another deal, until the paperwork comes together. I am getting a bit greedy and for the next want to find a rent or lease to own, which I have seen many of, that way I can buy a third and save my money. I also am going to look at a property that the owner wants to do a trade on. What does he want to trade? He wants a Harley, which I happen to have. If it is a decent deal, why not? I can buy another Harley anytime. At this point in the game, I am ready to evaluate any research I have.
I got one, now I want one a month minimum until the end of the year. Next year? TWO and month!!
As I said, I sat and worried for far too long, now its time to make money!!
As I said before:
"The moral is: Get off your butt and do something, I wasted three months hesitating and hate myself for it!!!!!! I sit and wonder how much I could have made in those three months, well I won't make that mistake again !!""
I will let you know how tomorrow comes together, It should go smoothly, I am sure.
David
Wow thats awesome you took action! A lot of people buy courses and never use them but you did!
~ Grace (If Donald Trump can do it YOU BETTER BELIEVE I CAN!!) btw I drew my display pic
I'm so excited for you! Keep it going
"I will NOT BE BROKE! ANYMORE!"
In the name of Allah, the Beneficent,
the Merciful.
22.He is Allah besides Whom there is no God: The Knower of the unseen and the seen; He is the Beneficent, the Merciful.
23. He is Allah besides Whom there is no God: the King, the Holy, the Author of Peace,the Granter of Security, Guardian over all, the Mighty, the Supreme, the Possessor of greatness. Glory be to Allah from that which they set up (with Him)!
24. He is Allah: the Creator, the Maker, the Fashioner: His are the most beautiful names. Whatever is in the heavens and the earth declares His glory: and He is the Mighty, the Wise.
I loved your post and am very happy for you! You took the leap and it's paying off. Congrats!
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This is true for RE..."The best way to learn this business is to do this business." - John Addision, co-chief executive officer, Primerica
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http://www.deangraziosi.com/real-estate-forums/investing-journals/18857/...
Great deal... if deals like these don't want to make you go out and get it done I don't know what will.
If the houses next door are selling for 40k, and you have a similar house, wow - I don't see how you couldn't pull $10k out of in a week? Was the wholesaler asking around $30-40k originally? If so, that is a great example of Matt's proclamation that going after houses listed too high works, because they don't get offers - so when one comes along they are very interested, even if it is low.
Great work - and thanks for outlining your research process. That will be very handy for others to know how to find out what they can offer to wholesalers (who own the houses) for a deal.
Thanks for the positive feedback dgadmin.
As far as teh asking prices when, that is where things got interesting. I found on craigslist the house listed for 28k, 20k, 15k, then 12k all within four weeks. I found the house at 12k and during my research I found the other ads. My only conclusion was that the seller wanted this house GONE. I did find out "chatting" with the seller that they were out of state and also that they bought a group of REO's.
One habit I have and a suggestion I would love to pass on to those who are not used to talking to people, don't get in a rush. Like Dean has said and most successful business people know, just talk a bit and listen a lot, it's amazing what you will find out.
As I said I have budgeted 2k to put into the property to "pretty" it up and two weekends. I am confident that this time frame will provide enough time to get the work done as I deal with this type of thing quite a bit.
Total estimates for time invested with the touch ups are about 24 hours.
Potential profits 10k plus. I am perfectly happy to work for $415 per hour, I don't know about everyone else
Very good example for other like me who want to just start
to get into to a work.
Vary inspiring!!!
Congratulations.........
I like the fact that you took action and made it happen. We can read the book three, four or five times, but if we don't apply the info into actions, then none of this would never possible. Congratulation and now go out there and close on many more deals. Remember "Faith without work is Dead" and by your faith that you can make it happen, you took action and now, not only that you will close on this deal, but the next one, and the next one, and the next one, and next thing you know, you will be well on your way to the top. Great job Dave!
Lloyd
Sounds like you got a great deal, taking the first steps is the hardest. Good luck to ya...
That's it, I've had it. Enough "running the numbers" and "measuring the risk". My wife Vickie & I have been (and currently are) exactly where you've been. Too much research and overanalysis on how perfect we want our first deal to be.
Bought Dean's books two months ago, read them both within a week & have been "planning" ever since. We've looked at 7 properties in the past week and we are ready to make our move. I keep up with the site often, but have not really contributed because I've been soaking everything in, learning from all of the posts and research, research, research!!!
When I wake up tomorrow, I will be prayerfully contacting our agent to have him place offers on 3 properties - two Short Sales & one REO. We'll see what happens from there.
Thanks for the inspiration 'DSCVDVR'!
Joshua 1: 8-9
"Study this Book of Instruction continually. Meditate on it day and night so you will be sure to obey everything written in it. Only then will you prosper and succeed in all you do. This is my command—be strong and courageous! Do not be afraid or discouraged. For the Lord your God is with you wherever you go.”
This is great. I've been reading books for a while also and trying to make my first deal almost perfect, too much wasted time. Can you tell me what state are you in? In my area all property at least 250K, so where is for 10K?
Great deal David! I'm excited for you, congrats on getting out there and taking care of business!
Im in the same situation as you Ranger, I always read about people getting deals for 20-30k however houses here in MA are up around 250-300k. It makes it a little more difficult with no money and no financing, but it just makes it that much more rewarding when we pull the deal off!
That's fantastic!! Way to give yourself a kick in the butt and get it done!!
It's stories like yours that help others get past the nervousness and NOT get left behind! I am so happy for you, and now that you've jumped that internal hurdle there's no stopping you!!
You really showed REI insight in researching the Craigslist ads and getting a feel for what the seller needed. Win/win for both of you. Great job!!
Rina
"Obstacles can slow you down, but they can only stop you with your permission." Dean Graziosi (BARM pg 101)
"For I know the plans I have for you," declares the Lord, "plans to prosper you and not to harm you, plans to give you hope and a future." Jeremiah 29:11
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Ranger,
I am very fortunate that in Ohio I can find deals for as low as 5k, granted not the best neighborhoods and I always go to look at them with a friend, all the way up to million dollar homes. There is everything for the choosing, its just a matter of going and getting them.
Bought Dean's books two months ago, read them both within a week & have been "planning" ever since. We've looked at 7 properties in the past week and we are ready to make our move. I keep up with the site often, but have not really contributed because I've been soaking everything in, learning from all of the posts and research, research, research!!!
When I wake up tomorrow, I will be prayerfully contacting our agent to have him place offers on 3 properties - two Short Sales & one REO. We'll see what happens from there.
Thanks for the inspiration 'DSCVDVR'!
Robbie Inks
Robbie,
Thank you so much for your words and I like you looked and looked for that perfect deal. Now I can't stop, the deal does not have to be perfect just profitable
No guts, no glory - NO OFFER, NO PROFIT !
David
Im in the same situation as you Ranger, I always read about people getting deals for 20-30k however houses here in MA are up around 250-300k. It makes it a little more difficult with no money and no financing, but it just makes it that much more rewarding when we pull the deal off!
Vern,
I agree I am fortunate to have such a wide variety of home prices to choose from, but even with inexpensive homes I found a friend to invest with me. In our case it was to pool money to get more deals going at once, but perhaps it would also be a good strategy to get the first deal. The other option is to expand the area you are looking in. Recently I traveld to Houston to visit relatives and in the classic family tour of the city, most of my questions were focused on the real estate and what was happening. While we were relaxing in the evening I dragged them onto Craigslist and asked them about neighborhoods I found listings in.
The way I see it, I am fine making deals in Ohio or Texas
David
Way to go! I too have been re-reading the books have looked at houses and still waiting to make the offers. Waiting for what I do not know! You have inspired me to re-evaluate the ones I looked at and motivated me to look at more and I am going to place offers this week! ;0)
Keep up the good work!
hillvalley
That's fantastic and very happy for you !! Best of luck !!
Warm Regards,
Paul