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$136,000 CASH on 4 Deals in Only 2 Months

by Arthur V. Veal, IV   

I made $6,000 for two hours of work, and I am set to close on $130,000 worth of property so far this month for July! I have been reading and participating in discussions on the Real Estate Main News Group for about four years now. I have had several small successes in that time, but I believe in the last two months, I have really started to come into my full potential.

I have been a real estate investor since 2000. I have mainly focused on rental property, and I made a very modest living. I did get some nice checks from refinancing. but nothing that I really considered profit. Well last year I had a bit of a problem: About 75% of my tenants moved out of several different properties in a three-month period. It really put a strain on my family.

I was disgusted, but one day I sat down to read some success stories and chat on Creative Real Estate Online to forget about my problems, and I decided I would try some different techniques to investing other than rentals. I did some extremely cheap advertising (about $200 total), and I started to get calls on deals.

The first deal I got was a woman who was in foreclosure on a two-flat building. The building was worth about $75k now and once it was repaired, would be worth about $125k. It needed about $30k worth of work from my estimates. The woman only owed $52k on the property and did not want any money for herself; she just wanted to be done with the foreclosure.

When I went to see the property it was in bad cosmetic shape, but overall it was not that bad. When I first saw it I was going to pass, but I figured what the heck! I didn't have any other stuff going at the time. So I put a contract on the property to try to buy it in a short sale.

I prepared a short sale package. The bank rejected my offer and wanted a full pay-off. Knowing what I know now, I wouldn't have started that way. So I went back to my seller because I had no cash to make a full pay-off and ended up taking the property subject to the existing financing.

Only it was still in foreclosure. So I had my seller sign the paperwork to transfer the property, and I found a rehabber to buy the property by offering him owner financing. I negotiated a forbearance agreement with the bank, and I got my buyer to pay me my cash of $6,000 up front plus the $2,500 the bank wanted to start the agreement.

He is now making the payments to the bank; the seller is rid of the property; and I got some cash! In three or four months the forbearance agreement will be complete, and my buyer will just make the regular mortgage payments while he rehabs the house. This entire thing only took me about two hours' worth of phone calls and driving to the sellers house and the property.

But that was last week (mid-June), Now I have two wholesale deals that I got from the same advertising, and both of them are set to close July 9. The average payday on these two is $25,000 each. I also have a four-flat I got from the same advertising that I am selling to a rehabber for an $80,000 profit! Yes, that's right $80k. This will close on July 12.

Thank you to Terry Vaughan, Ed Garcia, and everyone else here for the discussions, advice, and encouragement. You guys make this stuff seem so easy when I talk to you while I am always freaking out! But without your help, I never would have been able to recover from the situation that I was in, and I wouldn't be going to Disney World as a treat for myself and my family. Thanks!

P.S. The biggest lesson I learned from all of this was as long as I don't USE my money--I cant LOSE my money. Now I am only going to use OPM (other people's money).

 
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