All Forum Posts by: August Kleinschmidt

I have a relative who owns a vacation rental on Dauphin Island. The house needs new flooring throughout in the near future. Does anyone have a go-to contractor that they would recommend? Owners are out of state and anyone they have called either hasn't responded or is a no show. Thanks!

Hey Brian, welcome to BP! A group of us have started doing a meet-up in Springfield. It would be a little out of your way but you and your wife are welcome to join us. Next one will be in January. Good luck!

I will plan to be there!

@John Manta I have a house in Grandview. Rents are high In the neighborhood and the cost to buy houses is reasonable. There seems to be a lot of rentals in the area, not sure how that will affect things In the future. The further you go north away from North Grand Ave, the better it seems. I’m not an expert on the area as I’ve only owned the one house there for a little over a year but message me if you need anything else.

@Ashly McGlasson you and Mike interested in this? Good way to connect in the Springfield market!

Thank you all for the reply’s!

Good morning BP,  my name is August. I've been a long time reader and lurker of the forums but have never created a forum question. I'll give a little backstory before I get to my question. My wife and I have been interested in real estate for about 5 years. We saved up for a down payment and purchased our first rental property in Springfield, Illinois last summer. We purchased a 3/4 bedroom 1.5 bath house that rents for $925 per month, and we were able to purchase the house for $54,000 and completed about $5000 worth of repairs and updates prior to getting it rented. I keep about 25% of the rent set aside for repairs, vacancy and cap ex (probably too much but wanted to be conservative) and the house cashflows roughly $300 per month. It is about an hour away from where I live and work so I have the property managed professionally.

Now to my question, I've been looking into purchasing another property and I'm hoping to get a little creative with coming up with the downpayment. My wife and I saved up for the down payment and repairs on the first house but it will take me several years to come up with that kind of money again. I spoke with my bank and I have about 40k in equity in my primary residence that is accessible. It's probably not enough to buy a house outright but I was considering using it as a downpayment on another property. What I would like to do is find a house similar to my first and use the HELOC as a downpayment. My understanding is that the heloc is interest only payments for the first few years. I would like to use the cashflow from my first house and the cashflow from my second house to pay down the heloc and then I would have two cashflowing properties and then wash, rinse, and repeat. It won't be the fastest process but it seems like a better way to scale then just saving up for the years to buy again. Does anyone conduct their business this way and do you see any gaping holes that I am missing? I realize that whatever property I purchase as my second rental needs to cashflow well enough to pay the mortgage on the house, have money set aside for expenses, and still pay off the heloc monthly. I figured I could speed the process along by using cashflow from house #1 as my wife and I are not living off the cashflow just putting back into the business. Thanks for any tips, advice, or input that you may have!

Austin, I'm new to this site and came across this discussion while searching for something else but I may be able to assist if you haven't already found someone. I actually live in Jacksonville, Ill and could recommend a couple good contractors that we've used in the past. I'm not sure what the rules are about posting people's business's on the forum but I'd be happy to send them to you via personal message if you are still in need of someone?