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Updated over 5 years ago,
1st Investment Property
Investment Info:
Large multi-family (5+ units) buy & hold investment in Montague.
Purchase price: $38,500
Cash invested: $40,000
1B/1B Condo 500 sq ft.
-Kitchen with appliances
-Washer and Dryer in the basement
-His/Her walk-in closet
-Built in entertainment wall shelves for the living room and bedroom
-New flooring
-Personal deck has a beautiful relaxing view
-Parking
-Extra storage in the basement
What made you interested in investing in this type of deal?
When I was younger, I saw a potential to define success and wealth in Real Estate.
How did you find this deal and how did you negotiate it?
I found this location because my dad moved us up to the area. After graduating High School and getting plugged into the 9-5, I realized why pay rent and invest in someone elses property when I can own and pay the same on a mortgage or less. I knew nothing about negotiating and in fact the realtor walked me through with a few tips to save on closing cost and putting less down.
How did you finance this deal?
$1000 down/30 year mortgage.
How did you add value to the deal?
I added overwhelmingly much value to the deal by investing if not all then mostly all of my 401k.
What was the outcome?
I lost my job in 2010, hence using my 401k I had cashed out to rehab the property. I ran out of money and could not keep up with all expenses I had incurred. Eventually foreclosed but was forgiven the debt as it was my primary residence and taxes was up to date. At least that is all I can make of it.
Lessons learned? Challenges?
My biggest challenge at the time was distance, time, rehab cost and lack of knowledge of rock star contractors to say the least. When I got laid off, I saw an opportunity to try to educate myself with alongside a partner who is skilled in rehabbing. When I did acquire 401k cash out money, I spent most of it all if not all on rehab. We did the work to save on high end contractor cost. Furthermore, because of many aspect to everyday life, I became fearful and did not have a support group...