I have a full time job as a software engineer. With such a demanding job, I have to do my REI on breaks, during lunch and the evenings and weekends.
I formed an LLC for all my business activities with The Company Corporate (www.incorporate.com). They are a great support organization for small corporations, like myself.
After reading the BARM, I now am pursuing distressed Single Family Homes, purchasing them with Private/Hard Money. Rehabbing them and then refinancing the private lenders out ... leaving me with a low LTV mortgage, which is ideal for selling the property, on Contract 20 year fixed rate mortgage.
I like the Contract sales approach, because during that time ... I'm not a landlord ... I'm the bank, holding a mortgage from a good family with good income, that for whatever reason cannot get a traditional mortgage, usually it's bad credit.
This allows me to charge an above average interest rate and collect payments. Mailbox Money" as one of my RE instructors has said.
Also, often over a period of time, I'm told, many of these families will have a life event occur whereby they will not be able to complete the mortgage and will want to be released, which is something that I only do very hesitantly because of the enormous economic advantage it is to me.
At that point, I simply fix up the place, and sell it again, on contract, take a small down paymennt, and the cash keeps on flowing!
I don't like selling assets that can make me a good living for 20 years. I like 20 year mortgages, because it partly justifies the higher interest rate.
Well, I've begun ...
I have a list of private/hard money lenders ...
I have a list of properties and agents with more ideas for properties that meet my criteria ...
I'm now looking for Credit Partners that can assist me in qualifying with these private/hard money lenders, that now want people with decent credit, because they want you to have the addtional exit strategy of being able to refinance.
One private/hard money lender was telling me that before the credit crunch ... only 15% of his deals exited the private/hard money phase with a traditional refinance ... most were sold on the open market.
Today, 91% of their deals exit the private/hard money phase with a refinance, because of the tough RE market out there.
Anyone want to make up to 3%, just for buying properties with me ... where we get 100% financing using private/hard money ... do all the rehabbing work ... and then we refinance and you quit-claim to me for your fee?
What do you say?
Joe Terry, CEO/Founder
email: joet at virtuola dot com