All Forum Posts by: Aaron Almquist

My scenario for my question is: I purchase a duplex to BRRRR it, have one side occupied/rented and I occupy the other while rehabbing that unit and the exterior. It comes time to cash-out refi and the lender wants to see rent roll numbers.

Am I able to use comps for the unit I've occupied or if it's identical to the other side, use that number? Or can I not occupy it, must rent it out in actuality for a period, and represent the numbers that way? Have also read that some lenders will refi right after PM is hired and leases signed, no actual elapsed period of actual renting. 

I just want to make sure I am representing the numbers accurately to the lender and also that I shouldn't be doing something complex like paying myself (?) the rent but as a different entity, hahh. I don't know.. I've never done this before! Guess there are no stupid questions.... I hope. And I have to know this stuff before I even begin to do anything in reality, so thanks for your patience!

Thanks @Ron S. for the deep dive, I had no idea it was so complex. In my mind I thought it was them bearing it to the open market to see what value is determined by buyers via a bidding process and mitigating what losses they are able to. What I see in a lot of reserve prices is essentially comparable retail value... and what's the point of the trouble of an auction when you can buy off MLS at the same price with much more assurance. Then again, after I wrote my question I looked into an article on BP on how to buy REO's and it was illuminating in a lot of ways. Sort of lifted the curtain on the process after the failed auction and how to make an offer, i.e. coming in all-cash and writing "highest and best" prominently on your offer etc. I can understand that the bank wants to re-coup losses.. that sucks for them. And people are looking for whatever deals they can get. So your comment of art/science and smoke and mirrors makes sense to arrive at some kind of middle ground there.

Anyways, thank you for the info and also to @Kase Knochenhauer for that insight, I had no idea that could happen. I had also read that auction sites like Auction.com will bid their own listings up themselves.. seems shady but apparently it is in their Terms of Service. 

Guess I've got more reading to do on auctions... hahh. Thanks guys!

Does anyone know why the minimum bid allowed at an auction is not just the reserve price if they won't take anything less anyway? Seems like it just waste people's time or am I looking at this the wrong way

@Ryan Dossey thank you for the great input. I can work remotely from there, and I actually prefer IN to CA as crazy as that sounds to most people. Pointing out that 120k is one good deal at a time helps me a lot.. I thought so too and wanted to be overly conservative on even my most conservative numbers. Not getting greedy is important to keeping your money. Thanks again for your reply! - Aaron

Hi everyone, I am new to REI and so far have only been a have only been a homeowner and the last 3 years I have been house hacking in Northern California. I am in the process of closing and will hopefully net around $120k. I would like to take that money and invest it the best way possible and am willing to do what it takes over however long to reach success. My plan is to move to a market back in Indiana (I went to college in Terre Haute and know many other areas of IN pretty well) and begin BRRRR with small MFR.

Sounds like a great plan in my research thus far.. but am wondering what the most efficient use of those funds might be or if this roughly a good entry point. I would not need to initially borrow any money for acquisition or rehab, and then just cash-out refi. It also seems relatively easy (relative to CA) to get a real estate license in IN, so thinking of doing that as well. 

I am not very risk adverse and am wanting to really give it a hefty push into full time REI eventually. But I would like to start smart and limit wastes of time. After my research, this is certainly the method I feel comfortable with in the current stage of the market cycle, but am I also open to suggestions about branching out into occasional flips and other ways to build even more capital. Thank you!

- Aaron