Buy and Hold with gravy

[Ed McIver]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $105,000
Cash invested: $30,000

I was contacted by a wholesaler who had a lead on the property. The property was originally offered at $120,000. Due to the collapsing economy I said I would only consider "great" deals. I offered $100,000 without knowing knowing the address or condition. I only knew the town and it is fully rented.

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

I am investing for retirement. I do not take profit out of my real estate company. My goal is to have $100,000 in profit in 10 years. This property will bring me $12,000 per year closer.

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

It was brought to me by a wholesaler. I will only consider great deals right now. So we asked for a $20,000 discount before I was off the phone.

How did you finance this deal?

I am getting a conventional loan 5.25 %

How did you add value to the deal?

The property has a large out building. I will be renting the building out separately. 100 to 200 /month

What was the outcome?

So far so good.

Lessons learned? Challenges?

The seller was a bit hesitant. We agreed on a price early but he did not seem to want to sign the contract. Finally I gave a 5 PM dead line.