tri plex deal - your financing advice?

[Drew Farnese]

Hey guys!

I found a 3500sf tri plex in my area that just listed on the MLS. It is listed at 92,900. First floor 3bd unit, needs a kitchen, otherwise in good shape.

Second floor is gutted down to the studs. Would be 3bd 1 bath.

Third floor needs some ceiling drywall replaced due to some water. 1bd 1 bath.

As a quick guesstimate, I figure it needs about 100K in renovations. Needs roof, all new siding, all new windows (45 windows). I figure this alone will put me around 60K. From there I have to redo the kitchen on the first floor, complete build on second floor, and some tlc on the third floor.

Its hard to find comps for this place, as theres not too many multi units of this size in the area, but I figure it should be worth about 250K ARV, but more importantly, even if I'm all in at 200K after renovations it should cash flow about 1200/month after PITI, vacancy, expenses, and mortgage insurance.

(I will be living in this place for a year or two, all my figures account for me NOT living there however)

HERE'S MY DILEMMA.

I only have enough buying power to finance about 150K, because the taxes on this place are $7500.

Here's what I've considered, but please give me your thoughts!

Buy for $93,000 with FHA, 3.5% down, 203K loan for $60,000 to finance the roof, siding, and windows. Finance all the inside renovations with hard money and refinance once completed and pay back hard money loan. I don't know if this would work or not, but I do know that I REALLY don't want to pay hard money interest rates.

Other option is

Buy for $93,000 with FHA, 3.5% down, 203K loan for $60,000 to finance the roof, siding, and windows, then live in the first floor and renovate floors 2 and 3 cash by myself as the money and time provides. This seems like it could end in a never ending project.

What are my other options? I don't have any friends or family with large sums of money to lend me :/