Thom's Deals

I'm hooked! Can't wait to hear more.

I'm with Cathy. You have drawn me in also.

Born to be an entrepreneur!

Karen

Cool thanks! I'll start typing faster.

I love you man in Mexico right now wife is sick but coming back soon

After my snowboarding accident I needed to get my independence back and keep rehabbing like crazy 3-4 hrs a day. So I moved from CA to Newport Oregon and went back to school Sept 2002. After a few years of living in Oregon getting back on my feet and getting used to the geography I started to look closer at properties and found deal #2.
This was a non-buildable recreational riverfront parcel on 1.25 acres on the Siletz River in Oregon. After looking at several listings I had my eye on this one because the Siletz river is a very productive Salmon and Steelhead River and I've always loved to fish! Seller's were a couple getting a divorce on an inherited property and he wanted to sell and get a boat. Asking price was 39k but it had been on the market for months, so I talked with the listing agent and then put in an offer for 25k and was accepted, now I now that I should have offered less! I partnered with my brother and Lisa so we each owned a 1/3, paying $8333 each in the summer of 2005. We then rented a backhoe and started cleaning all the overgrowth and making a decent road for access. I went to the assessors office and to planning department to look into development but confirmed what i had been told it was an non-buildable lot because of an old illegal subdivision. I even paid an real estate attorney to confirm that it could not be built and tried every way to add more value by creating a buidable lot with no success.

In the meantime, we enjoyed this property for 2 years: BBQ, camped, fished, swam, snorkeled, shot guns at targets, use kayaks, and floated with inner tubes. This property was a little oasis just inland from the Oregon Coast.

After two years my brother wanted out and the original agreement was we would buy him out at 10k or we would sell the property after two years. We did not have the money to buy him out so we put it on the market for 55k. I really did not think it would sell for that price as a recreational lot and I really did not want to sell it but we soon had an offer at 54k cash and had an opportunity to double our money in two years time so we took it!

Here's the final rough numbers:

Purchased 25k
backhoe rental and general property clean up & grading 1k
attorneys fees $500
Sold for 54k

We still have lots of good memories from this property and we were able to reinvest our money into deal #3 and then life changing education...

Much love to you too! God bless, my thoughts are with your and your wife. Get back safely and hope to see you Tuesday at the REI club meeting.

Great to see and talk with you at the EDGE this year! Thanks for reading and the kind words!

Hi buddy who you doing? I will be reading as well when able....Nice deal on the last one...

Hey buddy all is well just trying to keep prioritizing the to do list and continue knocking a few things off everyday. Now lets go get some!

Ok small disclaimer these are not investing ROI numbers but this is our home with fruit trees, vegetable garden, a small flock of chickens and we were LUCKY to time some good appreciation.

After moving to San Diego in January 2010 for my current day job and renting an apartment for almost a year in San Diego. We were able to get used to the geography and find what was affordable in a great school district. Fall of 2010 we began looking at houses and walked through about 25 houses before we finally found one that we put an offer on (25-1 and we did not even know it!). The house is a 3/1 1050ft2 on about a 6,000ft2 lot. It had been newly remodeled in 2008 as a rental but the owner lived in LA and wanted to sell. Since we had baby #2 on the way Lisa was not up for much of a fixer so we were happy to find something that did not need a alot of work in a great public school district. They were asking 329k and we offered 289k with an FHA loan approval. They countered at 297k and we accepted. We put about 10k down (from deal #2) and received a FHA loan for the rest at 4.5% 30 yr fixed. Our initial monthly payment with mortgage insurance (this is needed until you have 20% worth of equity or after 5 years of payments), taxes, insurance and mortgage was $2100. Last year in February 2013 we refinanced at 275K for 3.5% on 30 year fixed and lowered our payment to 1710 house appraised for 330k! Wow we were pumped and a 30yr fixed at 3.5% that money is almost FREE!! Today this house would rent for $1900 to $1950 month and the comps for our house now are 350-375k. Now we have options which is one of MANY things I've learned through Dean's amazing training program, multiple exit strategies!

Ok this was our first deal within 90 days after signing up for Dean's training and education program which included the 3 day workshop. I also submitted this deal at the buying summit and received a deal of the month award!

This house we found through networking and telling everyone that we were now real estate investors! This house is a 3/2 1300 ft2 house that we purchased with NO money down and got the seller to finance the entire amount of 81,500 for ~1 year until we did a cash out refi with the bank and then passionately persuaded the sellers to use their money to purchase deal #9. There were no repairs needed and it rents for $1250 a month. Also when we refinance it appraised for 209k! So here's the final numbers:

purchase price: 81,500
appraised: 209k
rent: 1250
mortgage/taxes/insurance: 738
management: 0
maintenance: 75
cash flow: 437

Always harvest the low hanging fruit before you get out the ladder to pick the ones off the top of the tree!

I struggled for about another year before I got my next deal done because I had some negatively around me (sorry Lisa) and I could not figure out the San Diego market. So after attending the buying summit with my dad and then Lisa we all had a better idea of ROI. I started looking for good rent ratios in CA and found Merced. This is a smaller city (80k population with a higher than idea unemployment 13%! However, they have the new UC Merced school there and a huge WalMart distribution center is set to break ground in 2015 and provide about 2,000 jobs once at full capacity. Also they are planning to open a medical school at the UC too. I chose to start buying and holding here planting my apple trees and waiting for many years until I can enjoy the fruit!

This property was wholesaled to me from another DGer who used 25-1. I partnered with a private money partner creating a 50/50 split on cash flow and equity, after the cash out refi. It was a price reduced house that I purchased for 64,500. 4/1 1580 ft2 with a studio and a 2 car garage on a 10,000 ft2 lot zoned C2. Put in 15,500 in repairs and got it rented for 1100 month. Here's the rest of the final numbers:

purchased 64,500
repairs: 15,500
total in: 80K
cash out refi: 70K
mortgage taxes insurance: 537
maintenance: 75
water: 80
management: 0 (self)
50% cash flow to partner: 204
my cash flow: 204
appraised value from refi: 104,500

Some problems along the way:
had back garage window broken and someone take 4 doors out during remodel ~$300 for doors and motion light installed outside
had to remove old shed in back for insurance purposes costed 1300
Found out at refi i needed flood insurance cost 35 extra a month
found out in Merced owner must pay water/sewer cost 80 extra monthly
found out during refi that building was existing non conforming due to SFR on C2 lot: cost 200 for county burn down letter and application fee
Did not properly qualify prop management and I ended up finding great tenants after 3-4 months of being vacant and not getting filled, so i fired the prop managers...

All is all a great property with many learning experiences along the way!

Okay, Thom. I am hooked also. Some questions about Deal number four. I'm familiar with Newport, Oregon area. You mentioned living in Newport and moving to San Diego. How did the time frame of BD (Before Dean) and AD (After Dean)fit in? Was the seller part of your network in Newport? Was this after the move to San Diego?

Thanks for sharing. This is a tremendous bonus for many of us.

Be your very best always-Judy Williamson

What you focus on is where your energy goes-Kristin

With gratitude,
Patrick

Thanks for reading and the kind words. Seller in Newport deal #4 was an out of state owner and yes we bought the property after moving to San Diego.

I realize I left a few years out of there... In 2006 after I graduated and we had our first son. Lisa and I left Newport and moved to Santa Cruz CA to be closer to my family. I worked with my dad in construction for a few years before concluding that I needed to get a job with my new degree otherwise why did I put in all that work! So I did some volunteer work and then was able to use that to get a full time job at a algae biofuels company in the bay area in early 2009 but they closed the doors and had to let many of us go towards the end of 2009. I was fortunate to find a "good job" right away but we had to move to San Diego for it. It was at this time I realized that I could not rely on anyone for a job forever and I needed to have options = MULTIPLE EXIT STRATEGIES! It was just at this time I did not know what options were out there....until watching some amazing inspiring man on TV a few years later in early 2012 (DEAN!!) and signing up for a 3 hr seminar....then a 3 day workshop....then a platinum package for the buying summit, boots on the ground, and so much amazing education and people along the way!! I used a 1 yr no interest CC and some of the profits from deal #2 and to help pay for education and speed! I looked at the investment in myself and Lisa as a MASTER'S in REI!!

Hopes this helps fill the gap.

Best to you in your investing!

Thom

Now it is fitting together smoothly, Thom. Your contacts and networking seem to have paid off. It looks like your wheels are turning faster since coming across Dean. Keep us posted. I look forward to seeing the next episode of Thom and Lisa's Excellent Real Estate Adventure. Thanks for sharing.

Be your very best always-Judy Williamson

What you focus on is where your energy goes-Kristin

With gratitude,
Patrick

Hi Thom,

Barb & Drew Urbassik here....we met you at the April Edge Event this year...I loved reading your story...you are definitely an inspiration...I see you are also attending the Tim Robbins Event in San Jose in June...it will be a pleasure to meet up with you and Lisa since we are also attending...fun times, again...this has been an amazing adventure...

San Jose - here we come!

Hi Thom,
Just wanted to say thanks for sharing the details of all of your deals. The breakdown of each deal is so detailed. This helps everyone understand better and to learn from your mistakes. I started reading from the beginning and didn't stop until the very last word, lol. So inspiring and motivating! Thanks again!
Laura

Thanks for the kind words and glad to hear my story can help inspire you! Yes it was wonderful to meet and speak with you both at the EDGE. Looking forward to seeing you both at the Tony Robbins event in a few week! Let me know when you guys make the move to CA and we can go get a green drink or attend a REI club!

I'm so glad to hear that my story and deals have helped to inspire and motivate you. We all must continue to inspire and learn from each other to help us self motivate and have the courage to go out and take massive action! best to you and your investing.

Lisa had a pension from when she worked for the state of Oregon. After attending the Las Vegas buying summit and learning about trust deed investments, we looked at this pension to see what it had made over the last few years to find our whopping total earnings of $200-300. So with the help of the Dean's strategic partners at the summit we rolled the pension into a self directing IRA and used it to purchase a trust deed (note on a property, essentially we are the bank and carry the mortgage for two years). Here's the details of the deal:

This was a trust deed that was purchased for 16k at 12% interest. The property is a SFR in Milw WI. Currently the trust deed makes $150 month/$1800 a year and will make a total of $3600 over the 2 yr term!! Term is from June 2013-2015 and when the term is up we will buy another one!

We had some under the mattress money that we had been putting away for our boys savings. This money was making no interest and was merely collecting dust in our drawer and losing money with appreciation but before we learned about making your money work for you and REI through Dean, it felt comfortable to have some money just sitting around...time to get out of that comfort zone!

So we purchased a tax lien through Dean's other strategic partner tax lien tutor (TLT) after the summit event. Here's the details:

Tax lien had already gone through the redemption period (note most if not all of the tax liens that are bought through TLT have gone through redemption period). This tax lien was vacant land in an established neighborhood with SFR on both sides of it in Homestead FL purchased for $2700 at 16.5% interest. We have had the attorneys that TLT works with send out multiple letters to the owners with no response. So now we have to decide if we want to start the foreclosure process and potentially get the lot. Stay tuned for this one as the tax lien has not redeemed and we have to do our own due diligence of the area to decide if land value or cost to build and flip is worth the cost of foreclosure...

Ok going for a bike ride with the family around lake Miramar. Be back a little later, Happy Sunday all!

Thom

thank you for posting and sharing your deals! Love the lessons learned that you're including; they will definitely spare many of us from tripping! ...didn't know about the water in Merced

As always, it was so very nice seeing you and Lisa at the Edge, and I look forward to seeing you in San Jose in a few weeks!
Val

Thanks for the kind words. We all have our own stories and obstacles that we have to overcome. This site is amazing at providing education and inspiration for people to take action. I have and continue to learn so much here and be inspired by so many others. I'm hopeful that I can help someone else along the way too.

The other thing about the Merced water is that it is not metered! So there is a flat rate for everyone and keep in mind this is an agricultural town in CA where there is a major drought and this town does not track usage, amazing! There is no motivation to conserve water!!

It was great to see you at the EDGE and we have to keep our morning work out group meeting every year. Looking forward to seeing you at Tony Robbins, so excited for all of us and family to be part if it!!

Talk to you soon,
Thom

Love seeing your deals bro. Glad to see you all growing since we met you at Edge in 2013. We were supposed to be there for 2014 but ended up watching my 4 year old grandson for 4 months while my daughter recovered from a car accident. She is much better now and united with my grandson so we hope to be rocking something nice real soon. The education on this site, as well as EI, and the different trainings(Edge) are incredible! Can't wait to read about the other deals!

Thanks for the post and great to hear from you!. Yes, we missed you guys this year but look forward to seeing you at the EDGE 2015! I'm glad to hear your daughter is doing better. We all have to take care of oor loved ones first. I'm currently in Toronto for my day job work but will be back in CA on Friday night and will post the next few deals this weekend. Make it a great week!

This is Awesome! I love hearing about yours and Lisa's success! It was wonderful to see you both again at the EDGE this year. Also, Thank You for contributing.

I love how hard you work and the message you're teaching your children along the way as well. I still LOVE the story about your kids going door to door selling eggs. Love it!!!

Best of Success to you!
Andrea

Thank you for sharing your deals. Congrats on those deals. I admire your persistence and "not giving up" attitude towards rei.

God's time is the best. God had a great plan for you during the year you mentioned things were going slow BUT you never GAVE UP and I LOVE it.

God bless you and all the best in your rei journey!

You are such an inspiration Thom. Keep the motivation going I love Reading your progress

I love it Thom! Your successes have been inspiring me since I first crossed your path on this site in the Journal section! Now that I know a little about your background it makes it that much more inspirational! Hopefully I will cross your path at one of the future events! Thanks for sharing and Keep up the awesome work!!

Bob Fahey

Thank you for the kind words! You and Chip and have been a great inspiration for Lisa and I to help give us confidence that we can do this. Great to see you both at the EDGE again this year and thank you both for all the advice to help us move forward. We continue to be humbled by all the help and advice we receive from all the DG family!

Hard work and practice pays off and that is what we are trying to teach our boys as they grow up. Any way we can help them learn about money and negotiating(kids are natural at this!): saving, investing, and eventually compounding interest. I'll share the story that you mentioned in case it gives someone else an idea for their kids or grandkids.

Our oldest son is 8 and he wanted to sell some of our chicken eggs to neighbors to try and make some money. We wanted to encourage his entrepreneurial spirit so we had saved up 4 dozen eggs from our small flock of 10 chickens in our back yard. We agreed to sell the eggs for $5 a dozen and that we would split the profits with him. Half goes to us to help pay for more chicken food and half to him to put into a savings account. So we all went around the neighborhood and our 3 yr old rang the doorbells while our 8 year old talked to the homeowners when they answered the door. Really the neighbors had no chance to say no with 2 little boys selling eggs, especially the grandmas told them to come back when they had more!

Best success to you too!
Thom