Bits and Pieces
Posted on April 26, 2007 - Filed Under Business |
Over the past several weeks, a series of questions have been posted and I stated "I’ll address those soon."
As promised (some today, finish tomorrow):
Question: How much money did you put into this deal?
Clifford: Of the two deals, only one had money put down. After putting the earnest money into escrow, from there it was paying money for the housing inspection and the appraisal. Proceeding that, quotes were obtained from plumbers and electricians. They charged a small fee upfront, typically $80, which would be credited towards the work bill when they were employed. I was, at that time, 100% certain the property would be mine so I didn’t think twice. In total, I estimate my losses at $2100.
Question: How much time did you put into this deal?
Clifford: The last three weeks spanned a period of four months. Some days were more exciting than others, with lots of phone calls between Cat and myself. Other days, nothing transpired. It was a lot of fun, which was the very reason I started investing.
Question: Do you think that it is worth asking the lender to cover more costs than just the appraisal for their mistakes and misrepresentations?
Clifford: When BossMan called me, he said they were going to refund the cost of the appraisal to me. However he also stated he could not reimburse me for the earnest money I had already put down. He said that would be illegal. I consulted with Lord Google and he was just as confused as I. Maybe if there are some loan officers out there, they can shed some light on this (hint hint).
Question: What would you have done differently?
Clifford: With hindsight being 20/20? I probably would have went with my local loan officer instead of trying to find a lender in Texas. Also, the next time I encounter an out-of-state property requiring $10,000 plus in repairs, I may stay away. Putting some money in initially I can understand. But this was a bit much.
Another Investor left this comment: Consider the $2,500 (less the appraisal rebate) tuition in real estate investing school. Bravo!
Clifford: I laughed because this statement is true. At the time, I was more upset because the deal fell apart versus losing $2100. The money wasn’t important. What is important is my skill-set is markedly sharper than before. And since I believe nothing is for free, the money was well worth it.
I do have to admit: these past four months were exciting. I had an opportunity to do all those things I have been dying to do. I was in the command chair, calling the shots.
Wonderful. Exciting. Challenging.
If you liked that post, then try these...
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2 Responses to “Bits and Pieces”
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Hey, Clifford! I don’t think going with your local lender on an out-of-state property is necessarily going to work unless they’re tried and true at working with investors on remote projects. I had a buyer use his usual local lender when he bought some Tulsa properties–and, it was a disaster. Their lender did not work well at a distance with me or the title company.
Oh, and the tuition is steep at the school of hard-knocks, but the education is never forgotten!!!! Trust me!