rbaras

Hi all, Years ago, someone mentioned a website where people posted houses available as a 'rent to own'. I am not having trouble finding tenant/buyers. Does anyone use a website for finding owners willing to do a RTO? Thanks, Ronnie PS I"m not too lazy to respond to Craigslist ads ... I just want to expand my search options.

I now agree. In the beginning it was good practice to talk to people. Now, I'd just as soon weed out the dreamers and unqualified callers. I'd like ... to weed out the liars as well (and boy there are lots of them!!).

I am specifying neighborhoods but not numbers. What do you think? Better to pull in tons of leads ... or put in some qualifiers (i.e. minimum amount needed to move in)??? Thanks, Ronnie

Thanks! Ronnie

What I mean is, it works BETTER in some places than others and I'd like to figure out where. I'm writing this because I've been getting a lot of calls from tenant buyers in an area where the median price of a house is 340,000. I can drive for 30 minutes and head to an area where the median is 150k (not a war zone but very blue collar) or 30 minutes in another direction and the prices start at 500k. I have been advertising in the 340k areas and attracting lots of wannabe tenant buyers, but today my mortgage broker called me and said, "Hey, I'm glad you're feeding me all of these people but these people don't have a chance of home ownership. Their credit is so bad and their income ain't so hot either and even though I work with repairing credit, none of these so far are good candidates." So there you have it. At the same time, I know there are people like Bev who routinely get 10k and up for option consideration. So those of you who do tons of deals, what would you do if you moved to an area like mine and started up a lease purchase business??? Thanks, Ronnie

OK I see what you're getting at now. Yes I do the same as you, give the seller first AND last. But I require a lot more down. Are you saying that the T/Bs you're putting in place have a total move-in of only $5k??? So that's first and last plus their option money? I thought you meant they have first and last PLUS $5k, even that is low. If that's the case then you really aren't getting much of anything then are you? Like $1400? Ronnie, that's not enough for the knowledge you hold! Thanks Doug, No, I would NEVER allow a T/B move-in with only $5k. I don't want to do a deal if I don't get at least $5k (for myself ... and then a month or two (monthly pmt. upfront) more towards the deal which I've been giving to the seller). What I'm saying is that the vast majority of my callers say they have $5k. I only take the rare few that have first and last PLUS $5k, but these are very few. I only mentioned the $5k because that is the 'typical' call that I get. I thought ... maybe ... someone might say "Ronnie, you need to work in an area where the majority of callers say they have $8k or more." But it sounds like it's common for the majority of callers to have too little (renter mentality). We just need one good t/b per house. Hope I'm clear. Thanks, Ronnie

Thanks Doug, I'm typically marketing to FRBO's who are accustomed to getting an equivalent to 2 months of rent before move-in. So here we come in as offering a CA ... and I typically was offering 2 months of rent to the owner ... and keeping whatever else I could get from the t/b for myself. Before anyone says I'm 100% crazy, I want to point out that this can get lots of deals accepted ... but at a cost (money that could have gone to me goes to the seller). So I wanted to know if anyone does what I was doing ... or does everyone do Michael's approach ... which is to get the owner into a different mindset so that they're willing to accept someone (a t/:blush: who comes in with only 1 month of rent (I know ... it's really Option Consideration) going to the seller upfront instead of the customary amount equivalent to TWO months of rent. Thanks, Ronnie

Hi Michael! I understand what you're saying. What I was doing was offering the seller the same amount they would get as a straight rental ... and keeping the balance of the option consideration for myself. This can result in more deals accepted from sellers ... but obviously less money in my pocket. And yes ... a t/b with $5k available ... is not going to buy the home ... and therefore taking such a t/b would not be fair to the seller.

Hi there, For those of you that are making a living doing CA's in today's market, I'd like to see how your way of doing business compares to mine. Suppose you moved to an area where Neighborhood A has houses with an average ARV of $300k and average rent of $1800/mo. Neighborhood B has houses with an average ARV of $400k and an average rent of $2000/mo. For both neighborhoods, landlords are used to getting one month rent AND a security deposit equal to one month (a total of $3600 or $4000) IN ADVANCE. By the way, we're not talking luxury homes. With the scenario above, how would you structure your business with regards to what you require from the tenant-buyer and what you offer the seller??? Thanks, Ronnie PS Would your answer change if you knew that the vast majority of callers (potential tenant-buyers) say that they have a maximum of $5k (available upfront) to work with??

Lynn, I'm a real estate investor, but also an entertainer that does shows at various investor conventions. I love to meet with fellow investors ... and investor wannabes. From my vantage point, for every 100 people, 97 of these inspired attendees will leave the bootcamp ... and do nothing. Not because they don't want to, but because they don't have a clue how to start. Or ... they bought several courses ... and don't know which one to do. And the 3 successful ones??? They're focused on a niche. Oh maybe they are doing something different than a few years ago ... but they're still focused on a niche. Short sales ... REO's ... wholesaling ... rehabbing ... prehabbing ... sandwich leases ... CA's ... subject to's ... etc. etc. etc. etc. STOP THE INSANITY Pick a niche, do massive action, make money ... and then ... if you decide to pick another niche, fine. But finish what you start. If I had figured this out years ago, I wouldn't have spent this past weekend throwing out tons of courses I didn't even know I bought (and before you ask why I didn't sell them on Ebay ... would YOU like a course written in 1993???). Hey ... we knock those people that have jobs. But you know what??? Some of those people that worked for 30 years and lived within their means ... can actually retire to a pretty decent life ... and can even be millionaires. and they didn't do everything under the sun. They just did their job. You can lose weight with Atkins, South Beach, Jenny Craig, exercise, etc. Pick ONE ... and work it right. Don't do them all at the same time. Ronnie

Thanks Michael, It would make sense for the bank to renegotiate. But then again, even in these times, I often don't see the banks doing what makes sense. I think my friend has 2 strikes - damaged credit and being self-employed with income varying monthly. But he has nothing to lose by asking.

Hi! For those of you that do loan mods (I do CA's and haven't touched a loan mod.), I'd like advice on helping out a good friend: He's a self-employed realtor that ... almost lost his house to foreclosure. But he's been negotiating his credit card debt and has managed so far to save his house. He's now current on his mortgage. Here's the problem: He owes $460,000 (A first of $280k, a second of $180k ... both loans are with the same bank) on a house (personal residence) that's dropped in value down to $320k. His monthly payment on the first is $1700. His monthly payment on the second is about $700 ... for a total of $2500 a month. Both are interest only ARM loans (yuck), though the interest rates are not that high. He'd like to stay in the house. What, if any, are his options assuming that he wants to stay in the house (I'm concerned that because of damaged credit and being self-employed, perhaps he can't do anything but try to bring in enough revenue to slowly pay down the debt)??? I'd especially appreciate responses from those that have current experience doing loan modifications. Thanks!

I don't want to rain on anyone's parade. I am a real estate investor, actively in the business. I like a great idea as much as anyone else. I have attended many, many seminars by real estate 'gurus' over the years. When I attended the seminars, I made it a point of 'networking' with fellow investors. Some of them I've stayed in contact with over the years. A bunch of us got together this past weekend. Many (not myself) had gone an extra step and shelled out thousands (i.e. $7000 and up) to join a guru's 'mentorship' program. This allowed them the priviledge of phone calls with the guru. "You can do it" phone calls. But very, very few were glad that they joined. Why? Most of the gurus have assembled other people's ideas and have either never done a deal or ... it's been years since they did one. Many years. "My student made $20,000 on this one deal in 2006" is a popular mantra nowadays. I was particularly saddened to hear from disgruntled students about a few gurus that I REALLY thought were legitimate investors ... who owed students money (Why would the guru owe money to a student??? Try offering a $20000 cash prize in front of witnesses for the 'best student' and actually picking someone and saying 'Congrats, I'll send you a check next week)... but didn't pay because "my seminar business has taken a severe downturn". What about paying with the $20,000 you get from doing a deal that you teach, Mr. Guru???????? I have the highest respect for Michael Carbonare (and others) , whose posts consist of honesty and decency. But buyer beware for many of the others selling courses and seminars. Who do you trust??? Talk to satisified customers that have done deals and continue to do deals!!!!!!! DO NOT LISTEN TO THE PERSON WHO JUST BOUGHT A COURSE OR WHO HAS DONE NOTHING WITH IT ... BUT HIGHLY RECOMMENDS THE GURU NEVERTHELESS. Why did I write this? I recognize some of the 'ideas' on this board from gurus. I have yet to meet someone who is churning out $100,000 checks on luxury homes like clockwork (or even close to it). Hey if you're doing it, please let me know. I have an open mind. If I'm clueless, let me know ... but I only want to hear from someone doing it. Excitement over possibilities does not count. "I heard that people do it" does not count. "I saw checks from 2006 and earlier that flashed on an overhead screen" does not count. And my favorite "Now I have enough information to do 10 deals in ten months at $100,000 profit each" written over and over on a testimonial page ... does not count. Here's a little extra tidbit: A famous guru once told me that one of the cool things about selling courses is that 10% of the population will buy your course, no matter what. Hmmmmmmmm. Ronnie PS One more tidbit ... it seems to me that the more affordable the course or seminar, the more likely that it's actually useful. But still ... buyer beware. PPS Please don't misread my post. I have successfully done deals, sometimes with significant profits. I'm not saying this can't be done. I'm just saying that I'm surprised at the number of people who sell books and seminars ... who don't speak from their own experience. I knew this existed. I just didn't realize how prevalent!!!

Today I got an article from the major local Association of Realtors of Washington DC. The article stated that 2008 will be known as the year of the turnaround - where the bad real estate market started to turn into a very good one. Wow! I'm not going to post the article here. How sad that people can delude themselves. I still see articles that mention that conditions are ripe for a quick turnaround of the economy in just a few months from now. It kind of reminds me of the articles I read several years ago that stated that real estate will continue to increase 20% or more per year forever due to unprecedented economic conditions ...

Thank you Michael, Bev, Steve ... I'm moving on. I understand why I did what I did and more importantly, I know how to handle it better for the next time (which will be very soon). Now here's the interesting part: I was ready to send a firm letter warning that I fiercely protect my copyrights ... but then decided I should call the seller first. Lo and behold I call the seller who says, "We reviewed your contracts and we want to go with it." We'll see what happens. I called the tenant/buyer who said, "I've got the funds. Let's do this tomorrow night. Now, granted, this doesn't change that I made mistakes ... but I may not have put someone in business after all. There's another lesson that I learned from all of this. You can read post after post on these forums, understand the reasoning ... and even predict what a poster is going to answer. But the lesson is only truly learned if you are DOING the business. If you keep telling yourself that you'll start tomorrow and you notice that several months have gone by but tomorrow didn't come yet ... you're not DOING the business. Don't ask me how I know this. Ronnie