Mr. Garcia your opinion please. - Posted by Noel

Posted by Noel on July 20, 2002 at 18:20:36:

Mr Garcia thank you for your responce and I will be calling you next week.

Mr. Garcia your opinion please. - Posted by Noel

Posted by Noel on July 18, 2002 at 21:42:52:

Mr. Garcia first I will like to tell you that I admire the way you help people in this field. You are the person that makes most sence to me and would like your opinion on what I’m doing. I also would like your opinion on how can I change to achieve my dreams faster. My way of doing real estate is by buying houses that are so bad nobody wants them. I fix them mysef since being in the construction business I have learnd a lot of things. I do all of electrical, pluming, carpentry, tile, roof, etc.what ever is require to get it done. Than I refinance to pay expences and keep same to keep buying. I have found a loan company that doesn’t require seasoning. In the last year I open a line of credit base on equity of two houses but they only gave me 50k. My intension was to pay cash fix than create a mortgage pay expences end rent creating a cash flow and living the credit line clear to aquire more houses. I rent them because I find that to be easer than selling and creates a cash flow that will increase with time. So my dream is to create enough cash flow from them so I can be financial independent. Where I’m now is that with the line of credit I couldn’t buy cash but found two good houses that I bought with 10% down and I’m in the proses of buying another the same way. After the repairs i will have expend about 30,000 on the line of credit. The payments are low because good credit in the high 700’s. I’m clearing from $200 to $450 per house and I have 5 of them.Also each has a minimum of 25k of equity on each. Soon I will apply for more on the credit line but can you tell me what woud be reasonable to ask for so they will be less incline to reject it. thank you for your help.

Re: Mr. Garcia your opinion please. - Posted by Ed Garcia

Posted by Ed Garcia on July 19, 2002 at 10:29:49:


You seem to have a pretty good idea of what you want to do.

I do have some suggestions that I feel will bring a little more balance to your investing method.

  1. If you won’t let your wife collect the rent payment after dark on the house that you bought, that house is not a keeper. Even though it may cash flow, because of the area and the type of tenants you’ll attract, it will be management intensive and you will get very little appreciation if any. This is a deal that you buy fix and sell, utilizing the return of the cash flow to do more deals, rather than the rents as income.

As one of my students once said, a fast nickel is better then a slow dime. So you’re turning your money for cash flow to do other deals, which in turn will allow you to do more deals.

  1. If the property that you buy is in a good area that you would live in, has a school that you would want to let your kids go to, it’s a keeper. The reason is, not only will you have cash flow, but also you will enjoy appreciation as well as attract more stable tenants.


Noel I still don’t know enough about you, your market, how many deals you do a year or want to do a year, etc.

You’ve told us that you have good credit, know how to do deals with profit, and how you intend to do your next deal. You’ve told us that the $50,000 credit line that you currently have, is an equity line on the two houses that you have and that you borrowed from a loan company. I would think that you’re paying a higher interest rate then you would if you borrowed from a bank. Chances are you’re borrowing from Household finance, Beneficial finance, City finance, American General finance, or a finance company of this type. If so, they will eventually limit your financing and the number of deals you can do.

I’d like to have you call me at (909) 944-0199 so that I can ask you a few more questions and properly advise you. You could be a good candidate for a WLOC (Working Line Of Credit) with a small bank, which would give you better costing and allow you to do more deals.

Ed Garcia