Newbie from Dallas/Fort Worth area

[James H.]

Hi guys. My name is Brian and I am from Arlington, Texas. I work as a geotechnical engineer by day and am just starting to accumulate enough savings to jump into my first buy and hold deal.

I have already read many topics at Bigger Pockets and am already using the 50 percent rule to make cursory analyses of properties in which I might be interested. It seams there are enough deals that meet minimum general criteria.

I will be looking to finance a deal. From my research (e.g. looking at listings on-line and in person, speaking with lenders and my agent and perusing BP) it appears that the minimum cash requirement to get into a good deal is about $20K.

I have come to this conclusion for properties ranging from 40-60K. The more expensive properties require bigger DP and the cheaper properties require more rehab. All end up with about 3 to 4K in closing costs - if they are repos.

I currently have 12K at my disposal to acquire property and to have a safety net. So, since my comfort level lies with a 3K safety net, that only leaves me with 9K to work with. That amount money seams to limit me to Fannie Mae foreclosures (10 percent down as opposed to 20) in good shape for about 40-50K.

Until I have more money accumulated (it takes me about a month to save $1000) are there any other strategies that you guys recommend? Bear in mind I have a day job and am limited to evenings and weekends for boots-on-the-ground stuff. Any advice is greatly appreciated! If any DFW investors want to point out some of the best areas/neighborhoods to search, I would be much obliged.

I know this post is getting long, but I have another question. I recently came across a deal that fits my budget (above). The problem is that the neighborhood is squeaky clean, but about 70 percent of the houses have bars on their windows. The asking price is 40K and rent comps are about 850/month. Taxes and insurance would be about 2000/year. My agent advised against it based on the neighborhood, but the hood doesn't seam bad except for the bars on all the windows and doors. There are no foundations issues, no cracks in the brick or sheet rock, which is rare in the DFW metroplex in my price range(I am sure DFW investors would witness for me on that one). So, basically, my tenant quality would not be as good and the resale wouldn't be very good (estimate break-even). Bu I am anxious to get something that will generate some money so I can increase my rate of savings for the next one. All opinions are appreciated.

Thanks in advance for all your input!