HELP! Bank won't take my Proof of Funds letter from Coastal!

This is the perfect opportunity to find a true buyer because you have a property.

Let them know the details and make sure they are able to send you their POF before you meet them.

And even then meet them one or two blocks away from the property so they don't try and get a leg on you, research and contact owner or bank before they see it.

Good luck.

Just outside of Gardnerville, NV- perfect for someone who wants views of the magnificent Sierra Nevadas and stars at night, but also wants to be close to a town.
Yeah, it's one to grab, I just have to get it on contract! And there may already e another offer on it, so I need to move FAST.

Ladyfox7oaks,

I was in a similar situation and that is the one piece of the pie that prompted me to enroll in DG's latest course offering, of the 3 day RE Investing workshop. At the conclusion of the 3 day workshop, you gain access to DG's Insider's Edge Transactional Funding and Proof of Funds (POF) letters.

This alone was the single item that prompted me to enroll in the workshop. And I know it will also be what will allow me to move my investing career full steam ahead.

is to find a buyer, not going to a paid workshop because by that time the deal will be dead.

I would hope it should e easier than normal to find a buyer.

Do an ad with out mentioning address and make sure you ad in your fee for your services and im more than will ing to bet you'll get interested clients.

OK, Will do! I'll post one to Craigslist as soon as I'm done typing here. Thanks! (See you on Twitter!)

(Not to mention, while I'd love to do a paid workshop, I don't have the money to do that right now. Heck, I don't know if I can make my OWN rent for July, unless I get a deal DONE!)

Watch the presentation on my POF, transactional funding site below. I use the POF letter with every offer and have NEVER had an offer rejected. I have had B of A, Wells Fargo, Chase, Aurora and multiple local banks and credit unions call to verify my funds. They will supply their bank statement to prove I am good for the funding. Remember, nothing this great that actually works is free up front!! I hardly ever use the funds to close however! I just use the GREAT POF to get the offer accepted. These guys are the best in the business BAR NONE!!! I have my buyer fund my double closes. As some of you may or may not know, in order to use transactional funds your buyer must have his money in escrow in advance so what do I need the TF for at that point?? Dry double closing saves money. It may be that your buyer or the laws in your state will not allow a dry double closing, then and only then do I use TF. Think outside the box people!

Elix, correct as usual! Of course that all depends on our fellow wholesalers actually having a deal in the first place! So often what these guys think is a deal is not even close. Or they have no buyers. There is a learning process involved that is for sure. Also, I prefer to have the property under contract and totally control the deal when I wholesale.

Michael Mangham
Mentoring/Team Building Nationwide
MD Home Acquisitions LLC

elixbrown,

Sorry, but respectfully I disagree. Coastal letters are not worth the paper they are printed on, and it seems as though the RE Agent knows that. That is precisely why they are asking for a copy of your business bank statement or a legitimate POF letter.

While the OP may in fact miss out on this deal, this is not the last or only deal to be found. In fact, there are many many deals out there, if we all just look.

Something each of us will discover, if you have not already, is that banks won't waste a minute of their time negotiating a price with you for ANY of their foreclosure properties if you cannot provide sufficient documentation that you have the means of taking the deal down, should you agree to terms. And most Title Companies and/or RE Attorney's won't do simultaneous closings using the end-buyer's money to fund your purchase of the deal from the bank. You (or the OP in this case) will have to find transactional funding somewhere and proof of that funding, in order to move ahead on this one. This is not just my opinion; that is why they told the OP's Realtor that they would not accept her Coastal POF letter.

Good luck to everyone.

its been awhile I see things are going good for you.

You're lucky because I know some wholesalers here in the NY/NJ area that tried to use Coastal and the owners didnt want to use them, saying the same thing.

Thats why I mentioned having an investor fund it directly with your fee included.

Always have a Plan B

Am I missing something???

Ladyfox7oaks,

I too had a grand-slam homerun deal that I stumbled upon last year; it would have netted me a 6 figure wholesale fee (just in that one deal). But I too thought I could not afford DG's 3 day seminar course. Interestingly enough, that is one thing that they cover in the 3 day seminar....how to use OPM to advance your RE career.

Ohh, and Marc did tell the whole class how to take down a deal like what I stumbled upon....I do not think that the other class members knew why Marc told us what he told us, but I knew he was answering my question that I posed to him in the elevator (during my 30 second elevator speech! LOL).

As DG and Marc both say, invest in training to learn from and to avoid the mistakes that they and others have made, or make the mistakes on your own. Either way it is going to cost you (and each of us, myself included). Personally I'd prefer to invest in my training and avoid as many costly mistakes as I can.

I do wish you all the best. Good luck with your decision.

Not looking to get into a posting argument elixbrown; to each their own.

ladyfox7oaks,

Have you applied the MAO formula to this property?? I just looked at the very limited and rough numbers that you have provided, and quite honestly this looks like an extremely thin deal (if in fact it is a deal at all). Just saying....

MAO (Maximum Allowable Offer) = ARV x .65 - Repairs - your wholesale fee.

And the .65 may in fact be anywhere from .60 to .70, depending on the area where the property is located, etc. So when I plug in the numbers, this is a very very thin deal imo.

I wish you all of the best in this endeavor and your future RE Investing career.

Couples argue, not total strangers.

I just asked a simple question but no problem.

You make an inaccurate blanket statement about Coastal's POF letter. I don't use them and never have, however I know people on this site that have closed deals using a Coastal POF to get the property under contract.

Also, I have had people that SUPPLY transactional funding,(those trying to sell THEIR product) title companies, gurus and attorneys tell me you can't do a dry double close and you must use Transactional funding. YET, I do these closings multiple times every month!! How come?? It is totally legal here. You just have to find the right title company or attorney. If you ask a title company that closes REO transactions for the lender (seller) what do you think they will say? True, most title companies won't do it. Hey, you only need ONE and avoid the 2% charge and other hassles and costs involved with TF!

No Amount of education will keep you from making mistakes. Fear of making mistakes and becoming a professional student are just as costly. You never step out into the real world and separate all the THEORY from what ACTUALLY works in the real world in your marketplace.

Good luck and remember, No one, no investor, no guru knows everything about everything and there is no one strategy taught that is the only way. Take off the blinders and TAKE ACTION!! Make Offers!! The REAL education will start then.

Michael Mangham
Mentoring/Team Building Nationwide
MD Home Acquisitions LLC

Got to come back at you again. Do you know the amount on inventory available in her area? What is the demand like. What are the average DOM in the area of her property?

I will tell you this. Your 65% will not work in some areas. No offers accepted. It will be too low. In other areas it may be to high. You pay to much.

Also, in my OPINION the correct formula is this: Buy it at 65% minus repairs. Sell it at 70% minus repairs. Your fee is the 5% difference. This can vary also. Each deal is different.

The formula is correct but the percentages are NOT set in stone! You either adjust to the market in your area or you get no offers accepted.

This is typical theory that must be tweeked to the local marketplace.

Good luck and go make some offers!!

Michael Mangham
Mentoring/Team Building Nationwide
MD Home Acquisitions LLC

Can you tell me how you figure your local market out as to what percentages to offer. I want to offer 65% but it seems to low for my market, but I could be wrong. What is the formula or local numbers that helps a new investor to know this? Tammy

Femailceo,

Network with other local investors in the local REI clubs in your area. They will tell you what range is being offered and accepted by both banks and private owners.

Michael, that is precisely why I gave a range (.60 - .70). The range may in fact be broader in some areas; I don't have a problem with that at all. But if one is not applying the MAO formula (or some variation there of), then they are sure to get burned. I won't address your other slams or attempts to slam; not worth my time.

Sorry there Walter, no slams were intended!! In fact I can't see where any were made. Just statements of fact that could help you and other DGers. Gotta have thick skin in this business. Of course, every deal has an "MA0" they are just not always the same. I have had to reduce my fee and increase the MOA in order to get the deal done. So I made $2500 instead of $7500. I could have stuck to my theoretical "MOA" lost the deal and made nothing!! $2500 was a lot better than a big $0000.
Once again, sorry, no "slams" intended!

Tammy,

First off, two area are critical in the offer formula. If you are off on these the money comes out of your profit or the deal won't sell.

1. ARV.

You want to use COMPS sold in the last 90 days, currently listed comps and under contract comps. Any price reductions happening? Check the ones that were rehabbed/remodeled or in excellent condition when sold. What is the average DOM? Do not use REOs or short sales when determining ARV. The market will adjust for this effect on sales when looking at sold, listed and under contract rehabbed comps. What is the inventory like in the area? Is demand high? Are you seeing multiple offers. Properties selling at list and above? 65% won't work if that is the case.

2. Accurate rehab costs needed to bring your ARV.

Then you work the percentages just like DEAN teaches until your offers start getting accepted. If a bunch get accepted you are offering to much. So you must take action and try and wholesale properties while working with your buyers. A buyer can say he has $52,000,000 but that does not mean he is real.

I look to REI clubs for sellers, buyers, title companies, attorneys, inspectors etc. I don't rely on them to supply me with accurate market trends. 98% of them are tire kicking meeting attenders that only repeat what people have told them!! A lot of REI clubs are realtor/broker driven. They have their own agenda! And so do other investors. So learn this stuff by taking action yourself and try and buy and sell houses. This is the ONLY way to make money instead of spending money!!

Michael Mangham
Mentoring/Team Building Nationwide
MD Home Acquisitions LLC

So, has anyone ever used Dean's POFs? How has that gone?

Lady in OP, why are you insistent on bank financing? If that is necessary with this deal, try a different bank, or forget it all and move on to the next deal.

I'm only retailing (as a realtor) houses right now, not wholesaling or flipping, but If I have a deal go bad with a buyer or seller, I just move on. There's too much else to do, especially in my market.

HEEHEE, No I'm not insisting on bank financing, the BANK is the SELLER in this particular case.
It's all a moot point now anyway, as another buyer made an offer on Sunday, and it's been countered and accepted. So I lost out on this one...

Walter now that is a better piece of advice to network with other investors in my area, rather than the pm's you sent me just assuming that Arkansas should be in the lower range. You cannot assume, since our economy here in little Rock is doing above national average right now. We are not hurting to the point that many places are, so don't assume.

Michael thank you for the information on how to get to my offer formula. Michael I have finally found a club, and you are right the club is being run by a lawyer who is also a real estate investor. I tried to contact him, but he hasn't answered the phone, nor replied to my email sent weeks ago. Maybe I will move onto another lawyer. I am not sure I already like the way this club is run, I mean I tried for more than a year to contact this club, and finally got a reply. I am hoping that the club itself will provide some valuable networking and information, so I am just waiting for that first bi-monthly meeting to occur.

As usual our resident Michael offers up excellent advice, and with important details for our learning. Thanks Michael.

I might ad that in addition to the local physical market necessitating varying percentage offers, varying fees, etc., the current market conditions in the area also cause us to vary our rates, offers and of course profits.

Case in point: Vegas for the recent past 6 weeks has been in a terrific "feeding frenzy". For the previous 7 months for the majority of sales only pros were doing deals. Commoners saw Vegas as depressed and worse, but we were buying like crazy. I was getting deals at 20- 50 cents on the ARV dollar. Because I was wholesaling and my buyers all expected deep, deep, deals my fees were only $2-$3,000 each low end (under $50K) deals. As the news caused the frenzy of shall we say more retail investors to flock in AND our inventory dropped from 12,000 to 4,000 TOTAL on the market our numbers had to change.

Tammy, with regard to "how do we choose the percentage to offer?", I did this.
After my first 150 or so offers I had my own history of my own calculated offers and the eventual closed deal. At the time I tracked everything on an Excel sheet so I kept a record of all my offers, the original list price, any reductions, counter offers, rejections, and finally the sale price (whether I bought it or someone else did).

I averaged the offer prices I submitted on all the deals. It was 67%. So, as I got more aggressive and was placing 50-100 offers at a time I went in at 67%. In just a couple of months I could see my rejections increasing and my acceptances decreasing, plus I could see my MON (Multiple Offer Notices) and the consequential Highest & Best offers become more and more... As I increased 1-3% on my H&B, I soon came to the conclusion I needed to increase my offers from the start. I went up to 68, then 69 and finally up to 71% to try to catch deals. Because of the frenzy I still wasn't catching enough, so I went back to my buyers and asked them how they were shifting their criteria-- they were broadening their areas, and decreasing their discounts because they also needed to catch deals.

In the meantime, I analyzed Cash Solds. By comparing List Price to SOLD price and comparing those percentages to areas you can hone in on sweet spots; the widest spreads by area.

Anyway, I am sure you get the picture, and to answer you question, I would say look at a "today" snapshot of the spreads by cash solds to get an indicator of where you should be as far as initial offer percentages go. It's a constantly moving thing-- Real Estate lives and breathes.

Don't forget to Have Fun!
-Tina

for your valuable input. I guess real estate does live and breathe!

One of the benefits of attending DG's 3 day RE workshop is gaining access to the Insider's Cash money guys. Upon completion of the program you gain access up to $500k.

Now I have logged in, created my ID, and began to look into the Insider's Cash just a bit more, as a follow up as this alone was the single item that enticed me to purchase and attend the 3 day workshop. I was a little disappointed to learn that I would not get a PoF letter indicating that I had access to a blanket $500k. This put me off just a bit so I called the DG Success Academy and spoke with a coach.

Only then did they make me realize why I did not want (or need) a blanket letter that indicated I had access to $500k. Sure getting just 1 (blanket) letter a month is helpful in the paper process, but it would also put me in a bad situation regarding negotiations. Quite frankly, the seller (be it a bank or private owner) might not be so inclined to negotiate as much if they thought I had lots of or access to lots of money.

The process can be just a little cumbersome, but will probably save me tons of money. Basically I crunch the numbers, then if I am going to put an offer in I log into their website, enter the numbers, and then am able to print my PoF letter for the specific property and how much I can offer. That way they don't know just what my "credit line" is and will negotiate based upon the true numbers and the property itself, NOT my "line of credit" (so to speak).

Thank you Shaw for helping me to see things just a little different! I am absolutely gonna make this work.

REI -- Just Do It.