4 unit multi-family with 2/1 each unit, separate water and electricity meter. Found this through a well known wholesaler and this was my first multi-family and first time buying from a wholesaler. Mad few rookie mistakes during negotiations and learned a tons of things, it was not a smooth process but was finally able to close. The quad already had existing tenants so it started cash flowing from day 1; with my very conservative estimate I think this will cash flow atleast 500 per month.

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

The property was in one of the zip codes that I was looking for and the property need almost zero rehab.

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

Got this deal through a well known wholesaler. It was listed for 245K and one of the investor I spoke to said that at 245-250K this is a good deal (which was not the case). I ran my numbers and came up with a 240K offer, and my offer got accepted. I had ran my numbers based on 4.5 rate quoted by my loan agent but ended up getting 5.625, due to which I backed out of the offer and was ready to loose 1k ED but the wholesaler came back and we negotiated the price down to 222k.

How did you finance this deal?

Conventional financing, 25% down with 5.625 rate.

How did you add value to the deal?

Did not do any value add.

What was the outcome?

I am getting total 2650 per month total rent from this one and with PITI and expenses I think I will cash flow atleast 500 per month. Not a home run but hoping to build on this experience and buy some more multi-families in the near future.

Lessons learned? Challenges?

Learned tons of lessons on this one
1. Never ever trust the numbers of wholesalers as they always over value so always double check.
2. Who ever wants it the most is always the "looser" in any negotiation. I realized that I over bid on this one and so I had a frank conversation with the wholesaler and gave him my 1k ED and walked out of the deal. He came back to the negotiation table and I was able to negotiate a number which worked for me.

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

I would recommend my loan agent Ashli Williams from the Fairway Mortgage Corporation. With her help I was able to close this deal in less than 3 weeks.

Gorden Lopes

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My first multi family (quad) in Huntsville

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