All Forum Posts by: Aaron Gillette

I am running the numbers on my first walk through of this property and looking like $160 a month cash flow on this property with $1100 a month in rent. This is with $0 in the deal after a cash out refinance. So yes my return on investment would be indefinite, I'm not sure if the $160 a month is a great number. 

Does anyone have any insight they can give on how their first or first few investment property purchase was and how their cash flow looked? 

Quick rehab price snapshot :

So far they have seemed like a decent lender to work with but being new to this I haven't had much exposure. 

@Dante Belmonte:

I'll be out of town for both those dates... are they monthly?

@will chamberlin: first and foremost thanks for commenting on my fourm post. Right now at the same district my kids go to and it's about 20 minutes outside the city. Next to nothing in terms of availability in 3 or 4 bed room rentals. I'm looking now at a property valued at 75K and trying to purchase and rehab for 56k total. I also have looked into the meet ups in the area and will be attending them when I'm not traveling for work. 

@Bill Keast. I am going to be traveling for work at that time. Do you guys have anyone ever telephone in? That could be a possibility for me. 

After reading Rich Dad Poor Dad, I decided that I'm all in on this. So I began to looking into bigger pockets and listening to about 20 hours of podcasts. So first thing I noticed in my small market is that we have only a few homes for sale and next to no rentals open. So lets go look for the first few homes that need some REHAB that will make a decent rental. 

The first home I go to see is a complete nightmare. Someone started to work on the home and decided to quit and the reason is unknown. ceilings had mold and it was really a 2 bedroom home and not 3. The garage has almost no foundation left and probably would just need to be taken down and replaced.

I find a much better home at another great price but I don't have the upfront capital for the purchase price before rehab.......  

So I began to look into getting a HELOC on my home I live in now that I bought as a foreclosure just over a year ago for 45K. So I call the bank and along with great credit they go and tell me that the rough estimate that I can pull as equity is 100K. I was completely shocked. That's a 200% return as it only took 5K to get the house up to par. This doesn't include if I finish my unfinished basement with another bedroom, bathroom and office space.

Originally thinking I was going to start with a 20K house that would need a lot of work, to maybe a 45-65K house with less rehab to pull the 80% LTV.

I will continue to update this as the time goes on.

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $45,000
Cash invested: $50,000

Purchased my first foreclosure as I started to dip my feet into this new real estate venture. First of many purchases.

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

Needed to own a home in the local area and wanted to find a good deal project.

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

I found this deal on Zwillow and placed a owner/occupant bid.

How did you finance this deal?

My mother was able to advance me her revolving line of credit. After closing, the rate started to climb. I then paid of the line before I could get a HELOC from a few banks that I had asked by refinancing a vehicle and a balance transfer on a credit card with 1.9%APR.

How did you add value to the deal?

I was able to replace minor things, along with all new appliances and flooring. The house was stripped of copper and the boiler was destroyed, So along with new plumbing and a new heat source the house was up and going.

What was the outcome?

The current outcome is I now have a home free and clear that I can take a 70-80% (~65K) LTV HELOC on and place that into my first BRRRR.

Lessons learned? Challenges?

Continue to watch a market in which not many foreclosures or rentals are available and have the cash on hand to offer.

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

Joel Wenk was a local attorney I dealt with during this and he was great!