Posted by John Behle on November 22, 1998 at 24:40:34:
You have to wonder what’s going on with those refinances and other purchases also when he is so short he can’t pay utilities.
The number one cause of business failure is too rapid growth. It can happen in real estate also if the cash flows are not managed correctly.
Sounds like you made a real good decision. The only way I would deal with him or someone in his position is to lay out all the finances and help him restructure them.
On-Line-OJT…Part Deux - Posted by Soapymac
Posted by Soapymac on November 21, 1998 at 19:22:59:
Everyone,
I did not do the deal…for reasons NOT covered in Part One (below post).
How many times have you heard that this is a people business? More than once. And it was those the use of the people skills I’ve acquired over the years that made me say “Pass.”
Long story shortened: I asked all the questions that were indirectly given to me in the posts below, and his answers sounded very good. It was the last 45 seconds of the phone call that did him in…and he did it to himself.
He informed me that he was doing a refi on two of his properties, and in the same breath told me he was closing on two or three other properties in the next two weeks. He then asked me if he could borrow $1,000 from me personally to pay the electric bills on a couple of his properties HE ALREADY OWNED and he would pay me $1,200 out of the funds he would generate from those closings.
There was only ONE THING that went through my mind…and that was the word “mis-management.” I could envision that I would be lending into a pre-foreclosure situation.
No thanks. As a relative newcomer to paper transactions I just could not “see it.” I’ll leave myself open to being called less than intelligent about this, but I’ve always obeyed my thoughts when the hairs on the back of my neck stand at attention.
I’m sure I’ll be back with more questions. It’s just that sometimes EVERYTHING has to fit…not just the paperwork.
Soapymac