Closed Rentals #10 and #11 today

[Cliff Harrison]

#10 is a super clean move-in ready 3/1/1 in my favorite neighborhood in south kansas city.  2nd house using my portfolio lender Arvest.  Purchase was 62k with market rent around $900.  No work required on this one.

#11 is a house I previously had negotiated on and walked away from.  It sat on market for a month and went back and picked up in for $500 less than my previous max offer.  This one cost $55,000 in good condition, does need some tree work and a roof.  In order to swing the deal quickly this was an all cash deal and Arvest is starting a file today for a cash-out mortgage on it, which I will turn into three downpayments on additional rental properties. The house is a largish 3/1 with an add-on den with fireplace.  Decent blue collar area in south grandview.  I had previously bought a house on the same street and got a high volume of calls/interest on it.  I rented that other house at 800 but I'm sure this one will rent at least 875.  It's larger, still has functional garage, and I really was getting a large number of calls and showings on the other house - I ended up turning down three deposits.

Other Updates:

Had three move-ins for May 1st on new leases.  #8 house renovation in progress, the fence across the back was completed.  Installed the new roof on #7 house and signed a new lease with the tenant I inherited from previous owner - who did not have a valid lease in effect for over 24 months.  Had to pay $925 for an enormous dying elm tree removal on house #3 (Wally) and that was after I saved 575 by shopping around and going with a craigslist guy.  Spent 3 grand on two fences at #6 and #8 but they backyard view is incredibly better now for both.  Also had a microwave die at house #1 (Bella).

Inventory: I have two new-to-me vacant houses to fill and one rehab in progress.  All other units rented out and now occupied.  Hope to close about four more in May/June then take a few months off from acquisition and let things settle in for a while as I will have completed deployment of my primary residence home equity loan and the proceeds from a fancy car I used to have into rental properties.  So future acquisition will be a bit slower than the past five months have been, as one of my goals for this was to pretty much leave savings alone. After the next four I'll get into a pattern using cash flow to pay down mortgages one at a time, refinance out, and redeploy.  Plus the day job is really getting crazy with some initiatives the company has going on.  

[Phillip Syrios]

Originally posted by @Cliff Harrison:

@Phillip Syrios

Hi Phillip - my first loan with Arv was a conventional 30year (my 10th and last) and got competitive terms. This one was portfolio loan and it is a 5 year ARM on 30 year amortization, rate is about 5.25% with about $600 origination fee. It's not the sweet deal I got on my first four loans with my credit union but there is no balloon, which is what my other option consisted of. On the cash-out loan, they are going to be doing 75% LTV.

Who are you going with instead?

Thanks

Cliff

 Those sound like pretty good terms, the 30 year amortization is nice. Did they loan on appraised value or on cost into the property? We have really enjoyed working with Great American Bank. They have served us well and always been easy to work with. They have the same terms as just about everyone else but after we have owned the property for awhile they loan on appraised value which is great for us since they normally appraise for more than we have into the property.