North Meadow BRRR with 30 year fixed DSCR

[Mike Stahlman]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $139,900
Cash invested: $30,000

This is a property we bought looking at the house next door that sold in 2019 for 220k as a comp. We updated the kitchen with new cabinets and appliances, kitchen, dining, and hall floors with new flooring. the rest of the up stairs had great hardwood flooring. We changed the slab doors and trim to white 6 panel doors, and all new trim. Painted the house interior and cleaned up / repaired the out side. Did some work on the basement foundation. In the end we did a cash out refi for $165 pulling out all our cash and ended up with a good rental with great cash flow.

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

We saw potential to do a BRRR and was the first new rental deal we found since Covid.

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

Found it on Real Estate Site - MLS but was actually from a wholesaler we knew about that had it for about 8 years. I believe they wanted to let it go to do a 1031 and timing just worked out for us.

How did you finance this deal?

75k Interest only Loan and a Business Line of Credit from another property we have used several times and paid back.

How did you add value to the deal?

New Kitchen and flooring. Repaired an unsightly basement. Fixed drainage problems.

What was the outcome?

Got our total investment out in a 30 year fixed refi. Paid off the Interest only loan and line of credit. 345 a month Cash flow.

Lessons learned? Challenges?

Do not be afraid of the market or interest rates. If the numbers work and the deal is good trust your instincts. But know your numbers and leave room for error.

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

A local bank, Home Bank in Lake St. Louis, MO. for the Interest only loan and Business Line of Credit.
Dominion Financing for the 30 year DSCR loan.