Rags to Riches, Personal House Hack

[Mark Gainous]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $52,500
Cash invested: $15,000
Sale price: $100,000

Foreclosure - House hack. Purchased, and rehabbed over the next 18 months as primary home. Leveraged the foreclosure equity of $50,000 to purchase 490 South Broad Street at auction. Sold in 2015, to pay off both notes. 490 South Broad became primary residence, and rinse and repeat.

What made you interested in investing in this type of deal?

House hack, downsized from previous property. This was a foreclosure that needed a little TLC, and featured additional amenities like in-ground pool, secluded lot and incredible equity upon purchase/

How did you find this deal and how did you negotiate it?

Personally found the deal, it was a drive for deals method and noticed the marketings of a pre-foreclosure. Reached out to agent and submitted offer before it was listed on open market.

How did you finance this deal?

Combination bridge loan and cash.

How did you add value to the deal?

Complete interior renovation and pool area rehab.

What was the outcome?

Removed $50,000 in equity to purchase additional property at auction - and sold the property 18 months later for $100,000

Lessons learned? Challenges?

Open lines of credit are a very powerful financial tool, however use with caution.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I am a licensed real estate agent in the area.