Screening Investors/rehabbers
I see myself getting started with the offer making process in about a month after I bone up on homework and get me contracts christened by an attorney. Before I make any offers I would like to have a buyer list established, so I'm going to be posting some classified ads in the coming weeks.
I would like to know (from people who have done it, not people who just finished reading a book) what are the pertinent questions that should be asked of investors/rehabbers that will be calling me.
Thanks in advance. Anyone with experience in the Philadelphia market will be extrappreciated. I know that's not a word, but I like it. 
Off the top of my head
1) what areas of town they like or are restricted to
2) what areas of town they would not buy
3) what is their exit strategy - rehab, landlord, wholesale
4) what level or price of repairs will they make
5) can they close within 7 days - CASH
6) do they have a percent or net amount that they require to net
7) is there a certain type of house: bedroom/bath, frame/block, etc that they are limited to
how many houses average do they buy a month
9) what is the upper limit of the houses they buy
Brenda
Thanks Brenda,
mcldavid
If they are not paying cash , I always ask if the have been approved for a loan. I also make sure I have contacts for people to be qualified to be able to get a loan. There are many rehab loans available in your area
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Deleted by Poster[ Edited by shanlo78 on Date 08/31/2004 ]
Hello Holler:
I think Brenda and the Tinman gave you the best advice.
Here is my 2cents. Why dont you take it a step farther and line up some financing. Spend a day researching and talking to hard-money lenders in your area. Go meet with them, find out what their different programs are and what their LTV is. Also ask if they will give you
a referral fee as well. You could then also offer financing on the houses that you wholesale as well. This has worked
well for me, I also typically get kicked back a point or two for the referral.
Best Riches,
Jeffrey Adam
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Thanks, Jeff. I'll add that to my bag of tricks. There are alot of hungry HML in Philly.
Jeffrey Adams' idea of having lender options for potential buyers is good. Around here, you can get a list of local lenders/rates, (banks, mortgage brokers, etc...), through the title companies. Or you could open up your yellow pages and call a few lenders and 'splain your situation and ask them to fax you their qualification/rate sheet which you can make copies to give to potential buyers. Or even just make up a phone list of mortgage brokers, banks and HML's in your area to give to buyers.
Options are always good.
Good luck,
Noel
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Your buyers don't need HML, there are thousands of programs for buying houses that have been fixed up, especially for low income families. Banks know that 90% percent of the people have refied. Now they are offering start rates at 1.95% to refi. Banks must now concentrate on buyers.
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If you are looking to wholesale fixer-uppers to other investors, then you will
need either hard-money or private money. The problem with doing a conventional loan is your buyer will have to jump thru many hoops
to get the deal closed. I have wholesaled to people who went and got a conventional loan,
however it was not an easy transaction. I will only wholesale to people if they pay cash or close with a private lender or hard-money. I don't have the time to wait for them to jump thru all the hoops required to close an "A" paper conventional loan!
If you are going to retail to end-users, then you don't need financing.
Best Riches,
Jeffrey Adam
_________________
"The only place success comes before work
is in the dictionary."[ Edited by JeffreyAdam on Date 02/07/2004 ]
Pardon my ignorance, but why would you need hard money or private money if you want to whole sale to other investors? I thought wholesales were a way for people to start off without much capital.
Thanks,
Abhishek
You can refer your wholesale buyers over to the hard-money lenders or private
guys if they dont have their own financing.
Jeffrey Adam
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Ahh, for their financing. Didn't think of that, my bad.
There are many products for any one that wants to do a subject to appraisal.
example
sale price 100,000.00
subject to apraisal came in at$237,500
you can get a loan for up to 80% to 90%
if the person qualifies.
Now you just took the hml out of the picture, one closing , one set of closing costs and a conventional mortgage
Perfect for a "newbie with no money" or someone that has money tied up
Hope this helps.
[addsig]
Quote:
On 2004-01-22 15:10, shanlo78 wrote:
I have a "Buyer's List Application" that I think you'll find helpful. When I come into contact with a potential buyer/rehabber, I email, fax, or snail-mail this to him/her. If you're on the phone with a buyer, you could just run through the list of questions, also.
It's a simple form...only takes a few minutes to complete, but it asks many of the pertinent questions one should ask a potential buyer. (areas of town they're interested in, areas of town their not interested in, exit strategies, types of properties they're interested in, min and max desired ARV, max they could pay if they had to close in 10 days, etc.) You could even tweak it a little to fit your needs exactly. Lat me know if you'd like me to email or snail-mail it to you.
Shannon
Shannon - I would love a copy of this form. Can you email it to **Please See My Profile**
Thanks
Shannon,
I would like to receive a copy as well. If it's not too much trouble would you mind emailing me a copy as well? My email is in my profile.
Thanks In Advance[ Edited by ghegamin on Date 02/07/2004 ]
If you are purchasing properties, any successful investor knows that time is of the essence. Do you realize how long it will take to tie up a property, have your buyer go and get a conventional loan especially with all of the refi's going on these days. You will run into too many problems here. What happens when the appraisal comes back with all the repairs and the underwriter sees that?
Big problems!
One of the services I provide to sellers is the ability to close in 5 days or less. If you throw this into your gameplan and offer this, you will find more deals and your business will take off. Go and line-
up your private money, credit line, or hard-money lender and get it closed and make some money! Anyone who does volume stays away from conventional loans especially when dealing with properties with lots of rehab. A private
investor or hard-money lender for financing is the way to go. You dont have to worry about if it will close or not.
Best Riches,
Jeff Adam
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If your buyer's are not already pre-approved,find some mortgage lenders to work with. You may also want to check with your county/city housing authority about prequalified buyers in their programs. If you work through your housing authority you may be able to get low or no interest loans.
Quote:
On 2004-01-25 12:47, JeffreyAdam wrote:
Hello Holler:
I think Brenda and the Tinman gave you the best advice.
Here is my 2cents. Why dont you take it a step farther and line up some financing. Spend a day researching and talking to hard-money lenders in your area. Go meet with them, find out what their different programs are and what their LTV is. Also ask if they will give you
a referral fee as well. You could then also offer financing on the houses that you wholesale as well. This has worked
well for me, I also typically get kicked back a point or two for the referral.
Best Riches,
Jeffrey Adam
Jeffrey,
If they kick a point or two to you. What in gods name are they charging the poor rehabber. Quote me an interest rate and a point cost and a Loan to Value that they require.
I await in fear and trembling. Lucius
65%LTV, 3-7/8pts, 12%,1500.00 garbage fees
Vanguard Funding-(714)956-0508
Give them a call, they will probably broker you a point also on all referrals. They are the best hard-money lender I have ever used.
They can close in 5-7 days if needed. The game I play is I offer people cash next friday, not next season. "Hello Mrs. Crabtree, would you like your cash next Friday?"
Best Riches,
Jeff Adam
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Jeff
I have to take them to lunch and I have to offer a full recourse on all loans. But.
75% LV. 3 pts to meeeee. 12% int, keep one for full service. (collections etc.) I am named Trustee so money on foreclosures.
Translate, I collect, act as trustee and monitor all loan activities. I get of the 12% int 1% service fee. My lender, if the loan goes into forcl I run sales and charge. If the loan is overbid I get all fees and costs. If the loan is struck off to Beneficiary. I take deed in house and pay off the Bene: Sometimes I just throw another lender on for the period of selling house or whatever. We also do the appraisal etc. etc. Classic Deal Shop activity. I top at about $500,000 per deal. All in house. Full Recourse is the item that makes it all work. No lender of mine has ever had any problems. I have the problems. Prepayment penalties which I usualy waive are of course payable to me. This gives me a loan source for my activities. If I am involved I can go higher on LV but remember I am the one giving Full Recourse.
This was pretty standard starting about 1965.... I will be terminating this activity on payoff of the 8 items in portfolio.
I think at this time of life, I better settle onto one thing. Containers into Houses.
Since the 1930's when governmental agencies became involved in housing. It seems to have caused a continual increase in the percentage of family income spent on housing. I know what I do is a drop in a very large bucket, but maybe the example set might be catching and a trend reversed which if continued might change our Democratic/Socialistic system. What historicaly comes next is really bad news.
Looking forward. Lucius
Cheers. Lucius