Our first house: The Westminster CO foreclosure

[David Stone]

Investment Info:

Single-family residence other investment in Westminster.

Purchase price: $123,000
Cash invested: $2,000
Sale price: $149,000

Our first house! A 900 sq ft 2 bed home in Westminster, CO that we bought (unknowingly) during the market crash. It was a foreclosure so at least we started in the right direction... even if we had no idea what we were doing at the time!

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

It was in a nice area and a price we could afford (were pre-approved for)

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

We found the deal on the MLS. We were purchasing using FHA financing. The bank offered us 10k off the price to buy as is but our financing would not allow. We found a contractor who would re-plumb the entire home, the bank paid for it and we paid full price - we were all happy. The home was otherwise completely renovated (from a failed flip).

How did you finance this deal?

3.5% down FHA financing.

How did you add value to the deal?

We got the bank to re-plumb the entire home with PEX. Otherwise, we only painted the exterior (it was an ugly pink and was chipping)

What was the outcome?

We made $16,100 (but had to pay back the down payment assistance) when we sold.

Lessons learned? Challenges?

Check out my blog for the full story and how this ties into the rest of our investments!

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

We used Cherry Creek Realty (who I believe is no longer in business) and after failed financing through Wells Fargo (yeah... NEVER use them!) we went with Countywide (the bank who owned the property... and they had no problem selling it to us... imagine that!)