Little brother got his first deal!

[Benjamin Riehle]

Today I got to watch my younger brother Tom (24 years old) purchase his first investment property and I couldn't be more proud! I want to share the story and deal terms with BP as I feel it is very similar to the first deal a lot of investors are looking for. Also, I want to brag about my little bro. 

Story: It took Tom about 2 years of being purposeful and saving to get in a position to purchase his first property. He did not want any help from family and decided it was something he wanted to do on his own. After getting the financing in place he started working with an agent on my team and took roughly 12 months before he found a deal that was right for him. He set very specific requirements for his first property and was willing to wait until the perfect deal came up. The property was an off market deal that was presented to my team back in December of 2016. That's right, it took over 7 months to get closed. There were a lot of hurdles and challenges and every step of the way Tom stuck to his plan and used out of the box thinking and creativity to get the deal closed. 

Deal Breakdown: The property is a triplex consisting of two 2 bed 1 bath units and one 1 bed 1 bath unit. The 1 bedroom and one of the 2 bedrooms are rented, $600 and $890 respectively. He is going to move into the vacant unit with a roommate who is going to pay him $400 per month. His total rental income will be $1,890 per month. He purchased the triplex on an FHA loan with 3.5% down for $215,000. His total out of pocket expense with closing cost and down payment was around $8,500. He had the seller pay 2% of purchase price towards closing cost. His monthly payment is around $1,350 per month (principle, interest, taxes, insurance and PMI). With the unit fully occupied he will be living rent free and plans to put the $600 per month he use to pay in rent into a savings account towards purchasing his second property. He already has the timeline drawn out and hopes to purchase property number 2 within the next 24 months.

Hopefully this story inspires someone looking at getting into real estate and concerned about taking the first step. Tom spent a lot of time creating a strategy that allowed him to accomplish his goals and was very purposeful in sticking to that plan. He was presented with numerous properties that did not quite meet his criteria and rather than jumping on a deal that did not work he was patient and willing to wait until he found a property that fit his plan.

To all the new investors out there I wish you the best of luck! If you have any questions or would like more information on this deal please leave a comment or shoot me a pm!

Best,