My 1st Flip! Posting as I go. Mobile, AL

[Laura Verderber]

Hello everyone! I've been a landlord for 11 years but I've been really wanting to speed up my acquisition of properties. (Only have 3. Basically bought off the MLS when I had some money saved up for a down payment.) I contacted a wholesaler (that I found from Craigslist) to try and do a BRRRR. I ended up bidding on a house that I decided to flip. I will refinance to keep it as a rental as my backup plan, but because of the pool liability, I'd rather sell it.

It's a 3/2 brick with a saltwater pool on a half acre. I got it for $70,000, the hard money loan terms are 2 years, 12% interest, 5 points, and I had to put $2,500 in earnest money at the title company. Payments are interest only. He did 60% LTV, so enough to cover the closing and a bit for repairs. I estimate $15,000 - $20,000 in repairs. Carrying costs will be about $1,000 a month (Interest, utilities, insurance). I'm giving myself 4 months to get this done and sold. ARV $130,000. I have $6,000 saved up, can add $2,500 of my own cash each month, and have $14,000 in personal credit cards. Waiting to hear back from my applications for business credit. RSAS LLC.

I plan on cleaning up the lawn and powerwashing the house myself. I will contract for the rest. It has a gutted master bathroom, a rotted porch, a bent metal fence, needs a new pool liner and equipment, paint, new carpet, and cleaning. I got an insurance quote today. But I'm worried about finding a contractor. I'm planning on going to a local REIA meeting to get references. Anyone in Mobile, AL know a pool guy, paint guy, etc? Maybe a general contractor?

[Marc Middleton]

Sounds like a huge risk for $9,000. A lot of 'ifs' have to come together. Definitely should have had a GC lined up before the due diligence period ended and at least 1-2 renovation quotes on hand. 

Hope it all works out as planned, I'll be following this thread.