Second Deal (from 2014)

[Schuyler Witt]

Investment Info:

Single-family residence buy & hold investment in Tucson.

Purchase price: $49,000
Cash invested: $39,000

2/1 SFH. I bought this rental with no (personal) money down. I paid the loan off in 20 months. In 2016 the house appraised for $92,000.00!

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

The gentleman who loaned me the funds for my first deal sent me an email and asked if I was interested in a property that he had rehabbed, sold with seller-financing, and then repossessed as a foreclosure.

How did you finance this deal?

Banks were not lending money for mortgages under $50,000, so a mortgage was off the table. I decided to use a personal loan with Navy Federal Credit Union. I bought the house, rented it immediately, and paid the loan off as fast as I could. I paid the loan off in 20 months.

What was the outcome?

The property has been a great rental. In 2016 it appraised for $92,000.00! I'm using it as collateral for a business line of credit to fund BRRRR deals.

Lessons learned? Challenges?

Lesson 1: Out of state investing can be great! Mitigate risks with proper due diligence completed by trusted teammates.

Lesson 2: Find proper property management. I am in the military and because of my training and deployment schedule one year I lost thousands of dollars during a tenant turnover. I since got married and my wife has greatly improved all of the management activities!