6700 S Draper Rd, Tucson AZ 85757

[Alvaro Vallecilla]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $45,703
Cash invested: $40,000
Sale price: $162,000

This property was a short sale acquired from the USDA. The main objective was as fix& flip. However, I later thought it would be best to Hold it with a contract for deed or a rental a good choice as the home appreciated nicely.

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

Value add in the rehab in an appreciating market.

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

I found this deal though personalize pre-foreclosure letters. Speaking to the homeowners, who had not paid the mortgage for 7 years and the fact they had no resources to cure the balance and had exhausted several loan modifications. Basicaly, take some cash or lose the home.

How did you finance this deal?

Hard-money lender for the rehab face. Later did a JV with a passive investor.

How did you add value to the deal?

Remodeled the home and clean up all the junk the seller left.

What was the outcome?

Seller received $5K for moving expenses and we later sold the home after 2 years for a higher net profit!

Lessons learned? Challenges?

Fixing and flipping may not be the best exit strategy, in fact if the property cash flows once stabilized that may be the sweetest option.