I finally got my first deal after 6 months of studying Real Estate. It's definitly been tough but if your still a newbie PLEASE stick with it. Once it pays off it will most certainly be worth it.
I found the house when I was out driving one day. I must of passed this house a thousand times before but it's not until you get in the gam ethat you pick up on stuff like this. I saw it was vacant and in need of repairs. It was the old scenario of the uglyest house on a nice block. I found the owner in the county courthouse records, then looked him up in the phone book and saw that he now lived about 15 minutes away from the property. I gave him a call and asked he was willing to sell and he replied by saying “Well, the house needs some repairs are you sure you want it.” I told him that's why I called because what I do is fix up houses.
He then told me it's been vacant for about 9 years and that his son was supposed to fix it up but his job relocated him out of State. We set up a time to meet so I could get keys to the place to look around and see what was needed. Once inside, I saw it was going to cost between 30k-40k depending on what type of person was doing the rehab. Some investors have specialities or know of someone who is really skilled at some aspects of rehabbing and can get it done cheap. Anyways, I went back to him and told him my offer of 10k. I knew that was safe bet, but he said he wouldn't sell for any less than 30k. Being desperat for my first deal I took it. Homes on the block go for 85k-90k fixed up so I figured since it was so far beloew market someone would buy it.
I got my lender in there just in case I couldn't find a buyer and they didn't approve the deal because the margins were to tight. I was starting to get down on myself. It was depressing to have such high hopes and then in seconds have them completely blown away. But I didn't give up. I was still after my original goal to wholesale it. Well, I had buyer after buyer in there and some liked but said the same thing the lender said and then others were just flat out rude with how they carried themselves while telling me they didn't like my deal. My opinion, if you don't like a deal be humble enough to not turn into a complete jerk and just simply let the buyer know your not interested.
Moving along, I e-mailed a friend for some advice on what to do and they suggested that I go back to the seller and tell them my lender likes the deal just not the price and ask if he would be willing come down some. He did as his wife has been pressuring him to sell it since it's doing nothing but eating up taxes every year.
He came down to 20k and said that was as low as he could go. I told him I didn't know if my lender would approve it and that I would get back to him. I then informed some of the previous buyers of the new price as well as a realtor friend of mine who's a member of my REIA group. The realtor called up a buyer he knew of who was looking for a project similar to mine in that area. The next day he came out loved the place and we made the deal right there. I informed the seller that we had a deal at 20k and set up closing for next month. Today I met my buyer at the title company and recieved a deposit for $2,500. I was only going to ask for $1,000 but it's what he suggested. Who am I to argue. We're most likely going to close sooner than expected but he's waiting for his lender to process the loan. As soon as he does it'll be a 5K PAYDAY FOR ME!!! I already had the title work done because I got that started as soon as I signed up the deal. So please all you newbies out there take what lessons you can learn from this and never give up. PLEASE.
Derick M. Adams Jr.