Trials, Tribulations and Accomplishments of my 1st RE Deal

[Ricky R.]

Investment Info:

Single-family residence other investment in Haw River.

Purchase price: $48,000
Cash invested: $6,000
Sale price: $85,000

Absentee owner, distressed property, bought sub 2 giving owner 1k at closing and promised 1k per year for every year it was kept in her name, up to 5 yrs. Done minor rehab and lease optioned to a family who remodeled homes for 2 yrs at 800 per month,(my mortgage was 400 per month.) And 10k option fee. They finished rehab work and 2 yrs later exercised their option at 85k - 10k option fee= sold for 75k. Note was then at 42k. Give seller 2500 at disposition

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

I wanted to get my start in real estate by any means necessary.

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

Pounding the pavement. Made an appt to meet with current tenants to look at home. Owners were out of state and their family friend tenants destroyed the place. So they were ready to wipe their hands of it

How did you finance this deal?

Sub 2 with initial seller & 2yr lease option with end buyer.

How did you add value to the deal?

This was my first deal and I had zero money. I tried and tried to find private money or a partner to do a full rehab at first. Contrary to how easy it is for others to find partners and funding, I damn near give up on this deal because I couldn't. Oddly enough still having that problem lol. Truthfully, most prob thought the house was a lost cause or needed too much work. I spent 1 yr learning and networking prior to searching for the 1st deal so I felt I had a good foundation to build upon

What was the outcome?

Luckily found a way to buy the home with hardly no money to start, put a lot of nights work in, going after my then day job, to get the place presentable.. with hardly no money. Then found a way around finishing the rehab while cash flowing for 2yrs, and selling for a substantial ROI.

Lessons learned? Challenges?

The biggest lesson for me was to not give up. I heard a lot of no's and a lot of laughs. I couldnt even find anyone to assign it to. I was busting my *** and spending every extra dollar trying to buy and close and rehab, inspection, appraisal, not to mention the mess the tenants left me. Hope was fading fast Funding/credit partners was by far THE obstacle and in many ways still is. Lol Brandon turner makes it look easy but for me it is not. So I started studying creative financing strategies!

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

I met a lot of great people along that path. Learned a lot. Faced adversity. Overcome adversity. It ended up being so much more than a home investment. Looking back I wouldn't change anything but probably would try to stress a bit less ! And boy am I glad the first one is done 😅