OfflineSteve and Veronica’s Real Estate Journal. I have said in the past, I did not want to post anything on a deal, until the deal closed. I felt that it is not a deal until it is closed. I see so many other DG Family members writing about offers they make trying to get a deal done and I realized that is part of the deal so I should write about our real estate experiences good and bad. I have a lot to say to catch up here with this first post.
We started with real estate back in 1985 my soon to be Father-in-law told me if I wanted to marry his daughter I had to buy a home for her to live in. To save money to buy this house, we built a room in my Father in-law’s garage for me to sleep in. For 6 months, I worked two jobs to save the down payment money. At this time, I did not earn enough money to go with a VA loan and we had to use a FHA loan with my in-laws co-signing. In Jan. of 1986 I bought my first house for 80k at 10.5% interest. Our payment was $850.00 a month.
I had to rent bedrooms out to friends to help pay the mortgage. Then in August of 86 we got married and Veronica moved in. With my wife working and me working two jobs, we still did not make enough money to pay the mortgage without renting to roommates. After a year of living with roommates, we decided to move back to Veronica’s Mom and Dad’s home and rent our house out to one family.
The last day of 1989 we were blessed with a little girl. I was from the Midwest and my wife and I thought it would be better to raise our daughter in Indiana where my family lived at the time. Veronica’s Dad told us he would give us 40k to buy us out of our home after one of his other homes sold. So off to Indiana we went. It took a while for my in-laws home to sell to give us the 40k and we were down to having no money, no job, and bill collectors calling. Veronica went back to California with our daughter to work and help get the house sold. I said I would not move back to California and I could make this work out here. One of my brothers in Northern Indiana said he could get me a job up there in Elkhart. Finely in December of 1990 our home sold Veronica came back to Indiana with our daughter and the money. We were able to get ourselves out of debt.
We moved to Elkhart Indiana and I started working at an aerosol packaging plant as a maintenance mechanic making good money. In 1993 we bought our first no money down home using a VA loan and seller paying all closing cost. It was a great place to raise our daughter but Veronica was getting tired of what she called "12 years of long winters." She wanted to move back to California. We left Indiana in 2002 with 60k from the sale of our home.
In 2002 the prices of homes in California were going through the roof. We bought a 255K home with no money down, again using a VA loan and seller paying all closing. The week after we closed on this house Veronica and I got laid off from our jobs, we worked at the same place. Veronica was able to get a job right away but it was harder to find a job that paid me what I was making as a maintenance mechanic. We still had money in the bank from the sale of our house in Indiana so we knew we would be okay for a month or so. I have worked for over 20 years without taking any unemployment benefits. So I took the school benefits and put myself through a 23 week Sheriff’s Academy. After I completed the Academy I worked as security at a mall until I was hired on at a Sheriff’s department. During this time houses in California were going up in value like crazy about 10k or more each month.
We moved to Northern California and sold our house in 2004 for 410k that was a 155k profit. We paid 17k in commissions to the real estate agent. We still had over 100k in bank. We bought a house in Northern California with 20% down for 385k. Due to not being on the job for 2 years I could not use the VA loan.
In 2005 the area we lived in was hard on Veronica’s allergies and we knew that if we were going to sell it would have to be very quickly because we knew that the housing bubble was about to burst. We sold that house for 399k. We moved closer to Veronica’s work and into a better high school district for our daughter. Again, we felt that the housing bubble was about to burst so we rented a home for the next three years. The house we rented was close to the high school which was convenient.
In 2006 we started watching Dean’s programs on TV and Veronica read Rich Dad Poor Dad. Veronica told me we needed to start buying homes and renting them out. By 2007 we had been to a 3 day class by Rich Dad but we did not want to pay the 24k-40k they wanted for their advanced training classes.
Veronica knew my Mom and Dad had never owned their own home and were great renters. Homes in the Vermillion County area of Illinois were not affected by the housing market like California was. We bought a house to rent to my Mom and Dad and in 2007 you could buy a house with no money down using a 80/20 loan. 80% on the first mortgage and 20% on the 2nd. We wanted my Mom and Dad to have a nice house to live in that they could feel that it was their own. My Dad takes better care of rentals houses than most homeowners.
In 2008 I bought the book Be A Real Estate Millionaire by Dean Graziosi. We paid $ 495.00 for a 3 day class by Rich Dad. Dean’s book cost $24.95 at the bookstore and had better information on real estate investing than the 3 day class we paid $495.00 for.
In the spring of 2008 our daughter graduated from high school and we felt it was time to buy a primary home for us again. Using Dean’s techniques we bought an REO home that previously sold for 655k we got it for 365k no money down with the seller paying 4% toward all closing cost and enough money left over to buy down the loan. The home was built in 2003 so it was only 5 years old plus it was a 4060 sq ft. We did not need a 4000 sq ft home but all the other homes in the area were smaller needed more work and were priced higher. This house was vacant for a year. The fence in the back yard was down from a windstorm and the neighbor's big dog had left big messes all over the back yard. So we told our realtor to request additonal money form the seller for for repairs. The REO bank said they would give us 1k for repairs in addition to having the fence repaired before closing. All the things Dean says to ask for on a deal the bank was saying yes to. We walked out of closing with so much money we had to have the seller put ther rest of the funds into an escrow account. I guess the seller cannot directly give money to the buyer at closing. However, we did get a check for over 1k at closing and the remainder was placed in an impound account wich was applied to insurance and taxes. Thanks Dean.
In August of 2009 we joined the Success Academy. The On Demand classes are great and the Coaching staff is terrific. We were on fire to get our real estate business going so now we opened a LLC and started making offers. We started with a duplex in the small town of Covington IN...FSBO. I have a sister that lives in that town and she looked at the property for us. The owner did not want to do seller financing so we talked to a small town bank about a loan. The bank said they would consider making a loan to us and needed a purchase agreement. The sellers were asking 38k for the duplex. We sent the sellers a purchase agreement that we printed from this DG site. We gave the seller 5 days to respond. The 5 days went by and we had not heard back from the seller. I called the seller and was only able to leave a message. Since there was no response to our voice mail my wife and I decided to move on to other deals. The seller called us back about ten days later saying she wanted a different contract. I had to tell her we have moved on from this deal. So we did not get that house. It was a duplex, one bed one bath each which had rental income of $550.00 a month together. After the mortgage payment it would cash flow around $150-200 a month. But we did not get this one.
We started working on a two home deal in Danville IL for 34k. I had my Dad go with the realtor to look at the houses for us. Remember we live in California. So my Dad said with a little work they would be good rentals. Both houses were two bed one bath homes that would rent for about $400.00 a month each. We had the down payment money and we wer talking to banks for the rest of funds. We got to the end of the time frame for the loan contingency and all the banks said our debt to income ratio was to high. That crushed us. ( Don’t let this happen to anyone of you reading this post.) We dropped out of the hunt for a deal for a few months.
We tried to see if the stock market would give us the capital to buy homes out right. That did not work out so well.
We refinanced our primary home and dropped our payment by $400.00 a month. I bought the book Profit from Real Estate Right Now. We were back in the game but I wanted to study the classes put on by the Academy and maybe get out of our comfort zone and try something else than just buy and hold. We bought the book Your Town Your Real Estate Profits and we are on fire again making this real estate business work.
I was talking to some coworker of mine about real estate and they said they would be willing to partner up for some deals. This was in May of 2010. We looked at a lot of houses and agreed to go for a house listed for 60k it is the worst looking property in the area in this part of California. The other houses in the area were selling for 150k. It was a two bedroom with one bath on a third of an acre lot. We put an offer in for 55k with the seller paying closing cost. The seller countered with 58k and we said OK. The bank we were working with told us they could not give a loan on this house due to a report of mold. We were dead in the water. We talked to a few so-called Hard Money Loan people and they wanted 30 to 40% down telling us there is no hard money 100% financing. Well with the mold issue which, in my opinion was not that bad we still decided to move on.
A few days later our agent called us and asked if we still wanted that house. The bank was willing to pay $2,100.00 for mold abatement if we would pay 60k for the house. It was worth it to us if the bank could give us something in writing that the mold was removed, so we said yes. Now our partner on this deal moved on to another deal so he would not be able to go through on this deal with us. Veronica and I decided to do the deal on our own. After the inspection report, we felt that there was too much work to be done to this house. The kicker was that the person the bank sent out to remove the mold ended up just wiping the walls down with bleach and not producing a clearance report for the removal of the mold. We countered with a 55k offer with a contingency that the house would appraise at 55k. The bank said no so we exercised one of our exit clauses ad canceled escrow. I just received information that we would get our earnest money back as I am writing this post. There are a lot of deals out there so we know that we don’t have to settle on just one house.
We now have the Set for Life program and are going to try some wholesale deals.
Sorry this was so long but we had to do a lot of catching up.
Steve and Veronica
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Yesterday Veronica went to a REI club meeting and met a new HML and a contractor. I hope we can put them to good use. Most of the offers we had going in California did not pan out. But we are going to put in a lot more offers in the next few days.
Steve.
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welcome back! I'm glad to hear you had a good time celebrating your anniversary-congrats again!
I was wondering how your Cali deals were going... I guess we learn with everything we do, whether they end up as deals or not.
Good to hear that you will be putting in many more offers!
Wishing you success,
Valerie
Valerie
“And will you succeed? Yes indeed, yes indeed! Ninety-eight and three-quarters percent guaranteed!” ― Dr. Seuss
"I believe in angels, the kind that heaven sends; I am surrounded by angels, but I call them friends" - Unknown
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Veronica and Steve I have gone to REI meetings and have found them to be helpful in meeting buyers and sellers also other investors. Educating me also as they have real local business people with skills that can help build a team.Good luck on your indeavors in next few days.
We did have a real good time out in Florida. We will always be putting in offers. You can't win if you do not play.
I will be putting an offer in on another Indiana property here soon also.
Take care Valerie.
Steve.
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HI Kathleen. Thanks for stopping by our journal. REI clubs are good places to network. I only wish I was able to go to more of them. I have to go to my primary job during most of the meeting times. My wife and partner Veronica was able to go to the last meeting.
Thanks again for stopping by Kathleen.
I hope all of your REI dreams come true.
Steve.
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We just put in a bid on another HUD home in Indiana. If they accept our offer my sister might partner with us on this one. It looks like a nice little house. A 2/1 with a basement. Kitchen looks new but needs appliances. I hope we get this one for the amont we offered. We will see.
Steve.
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Well did not get this last offer accepted but our agent is going to resend the same offer tomorrow. HUD is lowering the price anyway. So we are going to keep offering the same amount until the accept it or get a lot closer to our offer.
My sister went in the house today and she said it is in good shape mostly just needs new paint. There is some mold in the basement but it is not the black mold. The hose has been closed up for two years now.
Steve.
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What did you put on your business cards? I was thinking since I don't have a company name, phone (only home and cell) or answering machine,I would just put my name, phone: cell and home, and Annette Bates Real Estate Investor, We buy/sell real estate. I don't want alot of stuff on the card. Thanks.
Annette Bates
If it's to be, it's up to me! Believe in YOURSELF!
Hi Annette.
We have our LLC name plus our personal names on our cards. We only use our home phone number on our cards also.
Annette it is your business you put on your card what you want people to see. You can always change your cards later to a business name. Cards are cheap you can use different cards also for each type of deal you are working on.
I hope this helps.
Steve.
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We are going to meet with Dean at his Brainstorming meeting in September. We have our hotel and rental car and plane tickets all set up now. I hope the other students are as excited as we are for this Brainstorming meeting.
Thanks Dean.
Steve and Veronica.
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Today we got an offer accepted on a new HUD deal for us. It is the home we were talking about in post 396. 35k is the price they accepted. ARV is around 70k it needs about 10k in repairs.
I hope everyone in DG Land in doing well.
Steve.
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Congrats on the new accepted offer bro! You guys are knocking them down! Are you planning on going there to do some of the work or let family and contractors take care of it all? Mama and I hope to be very hands off for the most part on our deals. I would like to learn this stuff but think I would cause more problems or be in the way if I tried have the stuff. The one we plan on closing on in the next 2 weeks will need some serious cleaning out before any work is done in it so we'll be involved with that, hoping to be able to sell some of the stuff left in the house. You just never know what we might find thats worth something! SEMPER FI!
SEMPER FI
GET SOME!
Steve, I will be at the brainstorming session God willing!
Haven't told hubby yet; he's supposed to come with but he wanted me to back out. I thought one of the things included was a 2 day 1 on 1 with Dean, but the gal said it doesn't include that at all. I must have misunderstood something... But, looking forward to this brainstorming. I have learned SO MUCH in the past month! I will have to share in my journal, haven't been too good at keeping it up lately with all that's going on!
Oh, and CONGRATS on the offer being accepted! WOOO HOOO!
Thanks for the congrats. We will let contractors and family handle the repair work on this one. I can do some repair work but to take the time off to fly out there it is just better for us to let others do the work and for us to find the deals.
I hope REI is going well with you.
Jack you and Mama need to make it to the Edge event in 2012 so we can meet and you can meet a lot of other DGers.
You take care Bro.
Semper Fi
Steve
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Hi Tammy.
The package included a brainstorming session with Dean and just a few students at a time. So almost a one on one. I hope to see your Husband and you there. If not I know you have been doing great.
Tammy you take care
Steve.
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We have been very busy here lately looking at properties here in California with our Realtor. Is has been kind of hard finding a property that needs so much work that needs to be a cash only purchase. Then we have to sell the hard money lender on the deal. But the rewards can be great. The area in Indiana that we buy in is so small that there is just not a lot of properties available to buy.
We are becoming the people that buy all the houses there.
I do hope everyone in DG land is doing fine. We are excited about our Brainstorming meeting with Dean coming up here in late Sept.
Everyone take care and God bless.
Steve
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Well we have been busy. Still trying to get some deals put together here in California and also working on a rehab in Illinois and the new purchase in Indiana. Plus everyday life.
We are getting ready to go to 12 hour shifts where I work so I will have a 3day weekend one week and a 4 day weekend every other week. But I will be working the graveyard shift. I will have the weekends off to spend more time with Veronica. Plus be able to look at more properties with the extra days off.
I hope everyone in DG land is doing well.
Steve.
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Yesterday we put in 3 new offers on properties here in California. We are working with a new HML for the newest property in Indiana. We have a lot going on right now. Tonight I start working the new 12hour graveyard shift how fun. But I get a four day weekend this weekend.
We will be looking for some money partners coming up here soon on some deals. So if you have money but can not get a deal put together for yourself we may be willing to let some of you in as money partners in the deal. Keep checking back with us or send me a PM.
Steve.
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So far we have heard back on two of the offers. One is in a biding war for highest and best already at asking price. The other one just accepted an offer. I have so much better results on my offers in Indiana and Illinois than I do here in California. I am going to keep making offers one out of 25 should take. Putting in offers is like fishing if you do not put the bait in the water you can not catch a fish.
Steve.
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We just received our inspection report on our latest deal in Indiana. We should be able to stay under our est of 10k for repairs. Cleaning up a moldy basement is the biggest issue.
Here in California we are still putting in offers. There is a lot more competitors in the REI game here in California. We can only put in offers that make since to us. It is not a good deal if we pay to much for the property at first.
We will be brainstorming with other investors out in AZ this week we hope it goes well.
Steve.
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Congrats on your latest property acquisition! Mold is nasty, to be sure. Just something I heard: bleach does not actually kill mold as a lot of people say, but hydrogen peroxide does. I had mold in an apartment was renting and had used bleach on it multiple times, only to have it come back as strong as ever. Then I used hydrogen peroxide on it and it got rid of it faster, and it stayed away longer. So, just a tidbit to check into.
You guys are going to be here this week!!!! Man, I wish I could come and just sit next to you guys and absorb by osmosis what ya'll are thinking and saying! I tried to get to the EDGE this year and it fell through, I was so bummed. I was even in the parking lot but just sat there and cried cuz my funding fell through. I will be there next year!!!! I will!! If there's one thing I learned from that it was to NOT count on anyone but myself!
Carry on.
"Persistence Pays, Procrastination Delays!" - smurfy
"I can do ALL things through Christ who strengthens me." - Philippians 4:13
"He will keep in perfect peace whose mind is stayed on thee" Isaiah 26:3
"Those who wait on the LORD Shall renew their strength; they shall mount up with wings like eagles, they shall run and not be weary, they shall walk and not faint." Isaiah 40:31
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Thanks for the info on the mold. I was just reading on some mold sites and they also talked about hydrogen peroxide.
Lisa your time will come when you go to the Edge or other events. We did not have the money to go to the 2010 edge event but we did not give up and we went this year in 2011. Lisa I know we will see you at the Edge 2012 event.
Lisa take care and God bless you.
Steve.
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We are getting ready to go to AZ for the Brain storming meeting with Dean for tow days. I hope it is a good meeting with other motivated investors.
Rehab is getting ready to start on the forgoten Illinois property. Yes we still have that one we were waiting on this one contractor to get freed up to start work on it. One of these day I need to switch to wholeselling and not worry about rehab cost.
Steve
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We are having a good time with Dean and Matt at the brainstorming event. They have been able to help each student with issues that each student is having personally. It is great to be with like minded investors.
Steve
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SO JEALOUS!!!
Cathy B
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We had a good time I feel Dean and Matt helped us out with some of our issues we were stuck on. Over all it was a good tme.
Steve and Veronica
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sounds like lots happening on your end. way to go! congrats on your newest deal. glad you had a good time with Dean and Matt this weekend. i am moving back to OK within the next week or so, then working harder than ever to get deals. i just mailed an offer to a lender on an REO this morning. we'll see what happens. i just wanted to take some action!
Linda, Army EOD Mom
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IT'S ALL GOOD AND EVERYTHING IS WORKING OUT PERFECTLY FOR ME!
Fear equals:
False
Evidence
Appearing
Real
Linda are you moving to OK for good or just a short time. I am sure Indiana will miss you. Best of luck to you also.
We are busy. Putting in a lot of offers here in California also. We should get one to take here soon on our 25 to 1 offers.
Plus we want to keep buying in Indiana. I want to own my old home town someday.
Take care Linda.
Steve.
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We are putting in more offers today. I have contacted some buyers to add to my buyers list. We have rehabs going on and other deals closing soon. We want to get 3 deals completed by the end of the year. I hope we get more.
After talking with Dean and Matt this last week I do not see anything stopping me from retiring by this time next year and doing REI full time.
Steve.
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We have our first cash buyer now. I never really wanted to start wholesaling but after meeting with Dean and Matt last week I know we have to wholesale. We are just passing up on too much money to be made. I started calling people that I thought would be cash buyers and I talked to a man from a big filpping outfit here in California and he told me to start bringing him properties. He told me what they were looking for and I feel we can supply him with good deals.
If any one out here in the Sacramento area has a house locked up and need an end buyer send me a PM.
I hope everyone out in DG land is doing well.
Steve.
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