Humbled New Investor

[Colby Kirkpatrick]

Within the last six months I have purchased two SFH properties. One in Wisconsin that I paid cash for 80K & one in Boise that I used HELOC on 175K Currently rehabbing both. I also have a sub2 I'm taking over April first. Tough lesson #1 Cash sales are great when done right (Used all my Heloc money to finance second property and had nothing left for rehab). #2 Took out personal loan for 40K for rehab and was paying my contractor by the hr. #3 didn't sign any kind of contract with contractor(Hand shake agreement). Just flew to Wisconsin just to find out that after 4 months and about 25k hardly anything has been done.

So now I have no money to pay back personal loan or finish rehabs/furnish properties. Looking Private Money/Personal Loan for 100k with a lower interest rate (4-6% six month term) 

Property #1 3/2 SFH PP 77k Rehab 40k ARV 170k seasoned as of Feb 10

Property # 2 2/1 & 1/1 Duplex PP 175K rehab 30k ARV 275K seasoned as of Mar 30th

Property #3 Sub2 3/2 SFH 0 down 20k rehab ARV 200k

*All three to be Medium Term Rentals with cash flow of around 5K

Thank You in advance for reading this far!!!

[Bryan Martin]

Quote from @Colby Kirkpatrick:

Within the last six months I have purchased two SFH properties. One in Wisconsin that I paid cash for 80K & one in Boise that I used HELOC on 175K Currently rehabbing both. I also have a sub2 I'm taking over April first. Tough lesson #1 Cash sales are great when done right (Used all my Heloc money to finance second property and had nothing left for rehab). #2 Took out personal loan for 40K for rehab and was paying my contractor by the hr. #3 didn't sign any kind of contract with contractor(Hand shake agreement). Just flew to Wisconsin just to find out that after 4 months and about 25k hardly anything has been done.

So now I have no money to pay back personal loan or finish rehabs/furnish properties. Looking Private Money/Personal Loan for 100k with a lower interest rate (4-6% six month term) 

Property #1 3/2 SFH PP 77k Rehab 40k ARV 170k seasoned as of Feb 10

Property # 2 2/1 & 1/1 Duplex PP 175K rehab 30k ARV 275K seasoned as of Mar 30th

Property #3 Sub2 3/2 SFH 0 down 20k rehab ARV 200k

*All three to be Medium Term Rentals with cash flow of around 5K

Thank You in advance for reading this far!!!

Sounds tough.  Maybe see if you can find an investor to buy one of them, so you have enough to finish the rehab?  Not a lot of easy answers, but keep working at it and don't be afraid to cut your losses if you think you need to stop the bleeding of cash.