03-03-2006, 06:23 PM | #111 | |
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03-03-2006, 06:23 PM | #112 | |
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03-03-2006, 06:27 PM | #114 | |
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03-03-2006, 06:32 PM | #116 | |
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03-03-2006, 06:49 PM | #117 | |
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03-03-2006, 06:57 PM | #118 | |
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03-03-2006, 07:17 PM | #119 |
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Wow, probably one of the more informative threads I've read lately. Me and a freind where talking of getting into property building/restoring. Hes got a lot of connections with various home building services because his dad owns a tile/flooring business. I was wondering though about all that background info you provided about 100% bank funding etc. Good stuff man, thanks. I think we want to start small at first and eventually get into building larger developments like communities. There is a 24 year old in our town who just built a couple hundred homes and made a killing. Do you think just about any market can work with restoring and flipping a home? Prices here in CT have been inflated for a bit so I've been a bit cautious...
I am wondering as well how you handle the contractors. I am assuming you don't employ a large number of contractors yourself and instead have a reliable company? Does that mean you are onsite as the project manager or GC? Oh and the Cayman S is awesome, if you've got oodles of money to spend then what the hey. I do have to reiterate though what most have said here, I just got out of a 4 year relationship that I thought was heading to marriage. Sometimes things change and sometimes they don't, such is life, if you are prepared to roll with it then by all means have fun with your money, just be smart with it. |
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03-03-2006, 07:29 PM | #120 | |
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03-03-2006, 07:58 PM | #122 | |
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One situation I had. I was looking to purchase a propety, I wanted to do an addition (this is a house im closing on in the next few weeks) I go to the township, after i submitted my offer and got accepted for $88,000. Asking price was 104,000 sold as is, but market value is 200,000. The lady is older and sick and wants it out, her father built it in 1950. Anyway I put in my offer, went to the township to get my building plans approved. I didnt go into attorney review yet, so this deal was still open to others. I get a call the next day from my realtor: Rob - "Arthur you have a problem" Me- " Someone just out bid you they are pay 110,000. The woman wants to take the offer, and hes paying cash and can close in 2 weeks" Me- "Fuck, ok Im not worried" Ok, now Im thinking. Cash? Must be an Investor. Closing in 2 weeks and offering over asking price? Must be some n00b investor with a cash out on his primary residence, he paniced now looking to flood the money into something" Now next thing i am thinking. Ok he will draw up some plans and run to the township to see if he can get approval for the building. Now I jump in the car, drive to the township. And since i just meet these nice folks at the township, they liked me cause I wasnt a dick or a punk. I say to the Zoning/Building Manager " Listen i have a situation, i got a good price on so and so, and this guy wants to steal from me i am 1 day away from attorney review can you help me out?" "sure thing we will deny the plans" Next day i get a call from the realtor: Rob " Arthur, the man looking to buy the property didnt get his plans approved, its still yours" me "Ok, thank god thanks rob" The moral? Stay ahead of the game, get to know people, be nice and respectful and others will have the same approach towards you. If you want to build new, Be very carefull, the market is not as stable as it used to be, there are many risks out there. Be careful what you get into and do your research, testing of the property surveys, termite inspections, perk tests, what ever needs to be done. If building new homes, always know. Do i have Public water/sewer/natrual gas? Thats a big plus, if not and your building out in open land. See whats a Ceptic system cost you, whats a well going to cost you. Factor in all your costs. The best way is to figure out all materials and calulate labor and material per SQ-FT on a new home. Average homes started homes up to 300K 400K about $120 a sq-ft 400-700 about $135 to 200 all depends on build quality materials and so on There are companies out there that will finance the entire deal, your land, your building costs and labor, based on that you will complete the project and what the houses are going to cost. If you see Acres being sold, 15 or 20 30 whatever number, see how much they are asking. Go to your township, see what the requirements are to build a home, everything ranges, .5 acres 1 acre 2 acres, whatever it is. Subdivied the land, that you have to go through the zoning department and get a verience, which can be a pain sometimes. If you ever plan on doing anything, try contacting IndyMac Bank or Buildmax, they are incrediable people and will work with you. Commerce bank on the east coast is also big with funding projects. Do research, read everything, and hire lawyers if you dont understand something. Or if in dought Ask me. *If you find a deal you like and dont know how to structure it, get in touch with me, for a fee (cause no one works for free) ill put the whole deal together, set you up with the financing, the builders in your area and work along side untill its complete. That way everyone makes money. Im not greddy, i love doing this, its a passion, and if I can spread my success, so others can live better lives, so be it!
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03-03-2006, 08:18 PM | #123 |
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Art,
only thing you've said that I don't think is quite true (correct me if I'm wrong) is that with other people's money (OPM ) the risk is all for the bank. I guess that might be true if you have almost no assets to begin with but once you've started making some money and accumulating assets you have plenty to lose. If you default on a loan eventually the people you owe money to are going to be dividing up your assets amongst themselves... |
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03-03-2006, 08:29 PM | #124 | |
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03-03-2006, 08:38 PM | #125 |
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Nice! I've definetely been reading a lot lately, just trying to figure out where to start really. Perhaps we'd like to form an llc eventually so we don't get hit personally too.
I know that some big players like Toll Brothers have been buying up land around the area, in fact a new community is going up 5 minutes from my home now from them. Seems like good zoned land with access to sewer, gas, elec, cable, etc is harder to find here and where it is the prices are astronomical. What are your thoughts on buying perhaps an old mill, like a cotton mill or factory and turning it into condos and reselling? Everything is in a single structure, tons of units to sell. I guess first would have to rezone it, and then the cost of the place would be a bit steep, but as a future purchase perhaps. I saw a great one called the Cotton Mill in NC that was really great after it was fixed up with condos going for $300-700K. I am a bit curious how this is structured though in the end, who would actually own the building once all the units are sold, are you still in charge of the actual structure? Regarding funding at first. I own nothing really, just a car, have no mortgage yet (that is next for me buying a home), and have a decent sized bank account. Do you think I would be able to get 100% financing from a lender for a construction job without having any assets? Does your net worth generally have to be equal to your purchase value? I need to make some $$, I love homes and architecture in general. Since I'm a designer already I can do all the web, business cards, logos, branding, marketing etc too for ourselves. |
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03-03-2006, 08:38 PM | #126 | |
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03-03-2006, 11:58 PM | #127 | |
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Wanna know why banks take hits like this? The bank would rather loose money, then close a year out with defualts and froclosures on the books, its not good for them. Its actually worse then loosing money. I know several bankers. I was under the same beliefe you are 2 years ago. Banks dont just loose many. But what I found out is mind boggling.
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03-04-2006, 12:05 AM | #128 |
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"Rider" University huh?
She seems very.... "talented" Sounds like a fun car to get...
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03-04-2006, 12:34 AM | #130 | |
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03-04-2006, 12:46 AM | #131 | |
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10 years ago John buys a house - Im not going to tell you how much the house cost because it is irrelivant. What I will tell you is the Final mortgage balance after a 30 year Note. John ows the bank 100,000 after 30 years, that includes principal/interest. John owns the house for 15 Years and all of a sudden cant make his payments. Johns Monthly payments are $277.77 up untill 15 years he has paid the bank a total of almost $50,000.00 John goes into defualt, cant make his mortage payments. The bank puts him in the preforclouser stage (Pre-Forclouser is another topic where you can buy from the owner at a discounted price) Noone seems to be able to help John come up with 4 months worth of late mortgage payments The bank Forcloses on the House, the bank now owns the house with a balance of $50,000 Remaining. Since John bought the house 10 Years ago, lets say. The house is now worth $300,000 The bank sometimes can get lucky and sell it at a sherif auction. But it is illegal for a bank to make MONEY on a forclosed Proptery Meaning - John owed the bank $100,000 thats all the bank is allowed to collect. Even in forclouser. Now this is where I come into play - I as an insider of the bank. Remember no one works for free. I can pay the remaing balance on the home which is $50,000.00 and walk away with the proptery, plus like a fee to the banker who brokered me the home. I now Own a $300,000.00 home for $50,000 in 80% of cases this home is well kept up and maybe needs some paint here and there. Now your ready for sale, You just made $250,000.00 and Mr. John is eat from a trash can. Dont you love this country?
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03-04-2006, 01:22 AM | #132 |
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Thats genius. So you're fee to the banker who brokered the home for you, guaranteed that you would "win" the foreclosure over the possibly hundreds of other people who are trying to get in on the same foreclosed property? There must be a ton of people who try to do the same thing so I am assuming you have to be very fast. Where do you get a preforeclosure list of property in the area to keep track on possibly bites?
So if you are always borrowing money from banks then all the real cash that you are making off each sale can be invested so in theory with $15million or so invested you could be making another $500K/year off of by not using your own money eh? |
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