Success Stories
Brad Pennington
By
May 9, 2005, 10:59

So here goes, the first deal!

During the last 6 months of 2002 I started seriously considering what I was going to do with the rest of my life. I was due to graduate from San Diego State University and I knew further education wasn't my best move and didn't want to work the long job ladder to success. During my search for direction, I took a weekend vacation at one point which, by a round-a-bout way, led me to real estate. I searched everywhere for every tid-bit of real estate investing information and stumbled upon the "creative real estate" world. I simply decided that I would give it a go and see what happened.

I decided that I wanted to learn to flip homes and make quick cash! After many months and many many hours of pestering everyone on every website that I could find and by taking some solid action it finally led me to where I wanted to go, or at least started me down the path. I must make special mention of the role Steve Cook played in this process because of his extreme availability and honesty to anyone who asks a question. Steve, thank you.

I was called by someone who had received a postcard of mine and needed an expedited solution to her problem. The post card was a fairly standard card which explained the services I provide and why those services can be especially important to certain people. In this particular case, there had been a death in the family which the owner was having a terrible time coping with, and on top of that the city was in the process of condemning the property. It was just too much for her to deal with, so I dealt with it.

Before meeting the owner, I performed my due diligence and comped the property in the range of $410k-$475k. I knew this spread was far to large but it gave me an idea of where I was and what type of offer to construct. I had driven by the property and determined that it was a complete rehab, unfortunately I didn’t have my repair numbers solid and so came up with a number that was significantly larger than the actual cost to cure. As it turns out, price wasn’t the main focus of negotiations and I got the house for such a good price that my overly large repair estimate didn’t factor in. The sellers main need was flexibility and I was happy to provide that. I put the house under contract for $200,000. For 2 and a half weeks I had a crew hauling personal property out of the house into a storage space that I agreed to pay for. I ended up assigning my contract to an investor who was referred to me by another guy I know here in town. I had gone to see this gentleman to review my title and escrow documents and to get some general advice from him. He gave me the name and number of this investor who liked to buy these types of complete rehabs. I called him up and told him about the house and he was ready to go. He wanted to do it that night, all cash as-is! I held off in order to show the house over the weekend to some other folks, but we ended up doing the deal on Tuesday. In good spirit he did attempt to negotiate my price down from $295,000, but I told him I couldn’t go lower than that number and he accepted. I think he knew that he was getting a good deal and he didn’t want to negotiate himself out of it. I assigned my contract to this investor for $95,000 dollars and he wired in funds and we closed! Total time from the first phone call to the check in the bank was 3 weeks & 3 days. Now this investor will repair the home (for around $60,000) and resell, or keep it as a rental. Win's all the way around.

It’s impossible to gauge the personal growth that one undergoes when doing their first deal and all I can say is that it was a very intense experience. With even this very limited experience I believe that future deals will come and be completed more easily because now I have personal proof that it can be done. I don’t know if I have any single piece of advice to give those of you who are still seeking. But one thing that did motivate me to excel was the idea that no one else in the entire world was going to live my life for me and that it was up to me to make my life what I wanted it to be. 

I love the positive atmosphere of this web site and it continues to be an indispensable asset to me and my success. If you make this work it will. If you ask for help here, you will get it. If you heed the advice given, you will prosper. Very simple really.

I can't describe how good it feels to make over $100,000 my first year out
of college! Absolutely incredible!

Here's to your success story!

Brad Pennington

Steve Cook is a real estate investor from Baltimore, Maryland. He is the owner of flippinghomes.com. For more information on Steve or his materials, click here