First deal evaluation: 4 plex and house hacking

[Steven Bonfante]

Hi, we need some help on evaluating our first deal.

We found a 4 plex that we want to house hack.  Here are the specifics:

• Asking: $335K  (will offer full price based on the market)
• 3 BR - $1200
• 1 BR - $750
• 2 BR - Our hack but currently getting $750 but could get more. Potential $1000
• Office space - currently vacant but has full bath and can convert (cheaply <10k) to 2 BR.  Potential $1000
• Tenants pay Gas/Electric/Water/Sewer
• Expenses:  $2824 (we use the BP calculator so this includes everything)
• Potential Cash flow ~ $950 including our rent for the hack and the office conversion.
• We have no skin in the game. Looking to get an FHA and have no money to put down.
• We both work full time and can easily cover the mortgage %100 if we had to.

To us it sounds like a no brainer.  We are ultra conservative and have passed up many properties based on the calculations.

Our questions/concerns/fears are:

• Are we missing anything?
• Are there any standard questions we should be asking?
• What should we get verified in writing?
• What should our contingencies be when we make the offer?
• Financing possibilities.

I know this is a lot but counting on the BP community.

Thanks,

Steve and Rae

[Christopher Phillips]

Steven Bonfante

Are the tenants on leases or month to month?