Second BRRRR! 23.99% CoC ROI with minimal rehab...

[Paul Beets]

Investment Info:

Single-family residence buy & hold investment in Indianapolis.

Purchase price: $43,000
Cash invested: $7,084

Small 3 bed 1 bath rental property. Four walls and a roof. Nothing special.

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

This arrived in my e-mail from a wholesaler as essentially a "turn-key" opportunity that was rent ready. That was the biggest interest I had in the property. The area is pretty good rental area as well.

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

Wholesaler e-mail blast. No negotiation.

How did you finance this deal?

I had a private lender that was willing to do 10% for up to 12 months with 1 point. Relatively attractive "cash deal" financing.

How did you add value to the deal?

We put about $6000 working to get it rent ready. Had to move a furnace due to code issues. A few HVAC repairs.

What was the outcome?

It rented out very quickly with pretty stable tenants.

Lessons learned? Challenges?

"Rent Ready" or "Turnkey" wholesale deals are rarely that. Always get an inspection prior to purchase. 80% LTV on a cash-out helps the cash-on-cash ROI!!!

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

This was my first BRRRR with a local credit union that does commercial portolio cash-out refis with zero seasoning 80% LTV . However ... we ran into title issues that drug the whole thing out to 8 months. VERY glad to get it cashed out!