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Updated about 10 years ago,

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7
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0
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Walter Grewe
  • Roanoke, VA
0
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7
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First Duplex purchase

Walter Grewe
  • Roanoke, VA
Posted
My partner and I closed on our first duplex yesterday. It was something I stumbled on while looking at homes on our local MLS ( I'm a licensed Realtor). The seller was offering to hold a 20% second so we jumped on it. The only financing we were able to find was a local bank willing to do 75% LTV with no regard where the other 25% came from. The seller agreed to move up to 25% with a 3 year balloon at 5% interest. The local bank offered 3 year ARM at 5% with a maximum 1% increase per year. The ARM renews every 3 years with a maximum 9% increase over 30 years. So here are the numbers. Sales Price $114950 Seller paid closing costs $2500 2 units $600 a month = $1200 1st lien = $462 2nd lien. = $154 Taxes monthly. = $118 Insurance monthly = $72 Water. = $40 Monthly Profit. = $354 The best part, I also received a 3% on the sale $3448.50, which after I deduct the taxes I need too, will be deposited into our company account. Total out of pocket, $350 for appraisal and $500 EMD. Our intention is to pay down the 2nd lien with $250 of the monthly profit in order to erase the majority of that within the 3 year timeframe and refinance into a conventional mortgage at that time.

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