St. Paul, MN Single Family old home

[Kevin Quintanilla-Toledo]

Investment Info:

Single-family residence buy & hold investment in Saint Paul.

Purchase price: $93,000

This was my first single family home purchase and I bought it with a 0% down military choice loan (different than VA loan). I have put in $14,000 to fix it up and getting it rent ready.

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

I just separated from the military at the time I already purchased a condo in CA. I had most of my money tied up in my condo purchase. I moved back to Minnesota and my parents place was too small for my family of 3 at the time. This was more of a necessity for my family and I.

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

I went through a family friend who was a realtor but she said that the only homes she could find in my limited budget of $110,000 was about 1.5 hour commute. So I looked myself and found this little gem in the heart of St. Paul, MN. The home was at the 21 day mark and the seller was motivated. I offered $5,000 under asking price and for the seller to pay for closing costs.

How did you finance this deal?

I used a Military Choice loan from Navy Federal Credit Union which is similar to the VA loan but its considered a conventional loan. The interest rate is usually not as good as the VA loan but it was a 0% down loan and it got me into the home.

How did you add value to the deal?

I ripped out the carpet in the living room replaced it with laminate flooring, updated kitchen, updated bathroom, and a fresh coat of paint.

What was the outcome?

We owner occupied it for almost 2 years and we loved the updates! I was able to charge $150 more than other properties near my single family home.

Lessons learned? Challenges?

I did not schedule out the updates very well. We were simultaneously about to close on our duplex and the closing was moved to the move in date of when our new tenants where going to move in. We underestimated the amount of work it would take to move and clean. For next time give yourself plenty of time to move and clean. Pay for more services like lawn maintenance, cleaning or just take some time off to get all of the tasks done.

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

The only lender that I would recommend for members using the VA loan would be Navy Federal Credit Union. But the downside is they are only willing to lend for the member to buy up to a duplex.