Skip to content
×
Try PRO Free Today!
BiggerPockets Pro offers you a comprehensive suite of tools and resources
Market and Deal Finder Tools
Deal Analysis Calculators
Property Management Software
Exclusive discounts to Home Depot, RentRedi, and more
$0
7 days free
$828/yr or $69/mo when billed monthly.
$390/yr or $32.5/mo when billed annually.
7 days free. Cancel anytime.
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
Buying & Selling Real Estate
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated almost 10 years ago on . Most recent reply

User Stats

86
Posts
15
Votes
Drew Farnese
  • Flipper/Rehabber
  • West Chester, PA
15
Votes |
86
Posts

First Flip - HUD property under agreement

Drew Farnese
  • Flipper/Rehabber
  • West Chester, PA
Posted

Hey guys! I've been busy the last couple months, and finally got all my ducks in a row. Getting my LLC set, and particularly getting financials in order took longer than I wanted, but it has been constant progression.

Here's the quick, down and dirty back story: I bought my primary residence (first property) in August 2014. I bought it for 89K, 20K in renovations, and now it is appraised at 180K. After everything was completed I got a HELOC, set up my LLC and bank accounts. I networked with many people and found some hard money lenders that I was ready to work with. After this I was all set and ready to get to work.

After that I had a few deals fall through, got outbid on a few properties, etc. I found a property on the MLS in my area and jumped on it. The property is a HUD home, which is a twin in a nice neighborhood not far from my home. Some details:

Purchase: $45,000

Rehab: $40,000 (This includes 15% unexpected cost)

ARV: $150,000

Annual Taxes: $4,000

Rehab is scheduled to be 8 weeks, which includes kitchen, bathroom, add powder room, build deck, finish basement, refinish floors, paint, landscaping and a few other items. What I love is it is essentially the same thing I did in my house just a few months ago, and virtually the same layout too. 

Now the best part...after I got it under agreement I put together a really nice packet to send to my hard money guys, some banks, and some potential private money lenders. I'm THRILLED that I got hooked up with a lender that is financing 75% of the total cost (acquisition + rehab) at 5.25%, and 1 point. NETWORKING PAYS OFF! This alone saved me thousands.

I have a home inspection set up for the end of the week and settlement is scheduled for April 17th. 

I left out many details to try to not bore you guys to death, your time is valuable! Please let me know if there is anything in particular I should look out for or expect with a HUD home or any other concerns.

Cheers

Loading replies...