Third Owner Builder with private money loan in Arcadia

[John Giang]

Investment Info:

Single-family residence private money loan investment in Arcadia.

Purchase price: $645,000
Cash invested: $200,000
Sale price: $1,248,000

purchased house with partner to build 4beds, 5 baths 3,928sqft house.

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

brought in a partner to purchase house in Arcadia , prime location in southern California. House was old and needed a complete redo. High potential return of capital.

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

partner found this deal and agreed to build together and sell.

How did you finance this deal?

private money lender

How did you add value to the deal?

complete rebuild of old homes.

What was the outcome?

completed house after 1 year of building. lost money due to market crash in 2009.

Lessons learned? Challenges?

should have refi to get cash out and pay private lender. loan value was too high to rent so could not keep house to rent. lessons learned is to get better financing options to do these projects.