All Forum Posts by: Barrett Goff

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Louisville.

3 bedroom/2 bathroom duplex near a college campus.

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

I wanted to start investing in multi-family properties and also wanted to start investing near college campuses.

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

The seller was a mutual friend who no longer wanted to be a landlord so we were able to negotiate an offer market deal and I still included my realtor commission!

How did you finance this deal?

I financed it as a multi-family investment property so we had to put down 25% and got a conventional loan.

How did you add value to the deal?

We already repaired the roof upon closing, patched some drywall spots and plan to replace the HVAC unit once the current tenants move out.

What was the outcome?

We purchased the property with tenants already living there and it has been a great property so far. We plan to hold this property long term and hopefully the area will continue to increase in value being on a college campus.

Lessons learned? Challenges?

So far so good, just be careful working with friends and family because you don't want to ruin relationships or hurt someone's feelings over penny pinching. We got a good deal and the seller was accommodating, but we almost pushed it too far on the repair requests.

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

Barrett Goff with Family Realty in Louisville, KY!

Investment Info:

Single-family residence buy & hold investment in Louisville.

Shotgun style house in an up and coming part of town. 2 bedrooms/1 bathroom and a cellar.

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

This home is located in a part of town that is absolutely booming. Bars, restaurants and entertainment are going up all over the immediate area.

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

My coworker notified me of the property, and luckily the seller was also an agent who initially listed the property too high which resulted in no interest. We watched the property gradually drop $20k, and then made our move. We ended up closing for another $6k off the new lowered price.

How did you finance this deal?

We used a 5 year ARM loan with 20% down.

How did you add value to the deal?

Upon closing we replace the entire roof and added a brand new HVAC system.

What was the outcome?

We are currently renting the property long term, but once the current tenants move out we will do further renovations to clean up the property and host it on AirBnB now that we have secured our conditional use permit.

Lessons learned? Challenges?

I have not had many issues with the tenants or property itself. Next time I may not be so hasty in upgrading the HVAC system so quickly, but otherwise this was a great purchase and the area of town has already begun to develop pretty quickly.

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

Barrett Goff with Family Realty in Louisville, KY!

Investment Info:

Other fix & flip investment in Louisville.

This was a townhome that we purchased, put a little money into for cosmetics and then sold a year and a half later for a small profit.

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

This was a property that we lucked out of, not into, but out of. It was a good home for us to live in for a 1 year stint with a roommate to help us pay the mortgage!

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

This was a nice complex in a good part of town with a lot of space inside the unit, including a basement. It had been sitting on the market for a few months (which is fairly common with townhomes and condos). We came in with a low offer and ended up getting the property for a decent price.

How did you finance this deal?

We used conventional financing with only 10% down which means we had to pay PMI :(.

How did you add value to the deal?

We were able to paint the walls, replace some countertops and replace the HVAC system and get out of there before any other work needed to be completed.

What was the outcome?

We ended up getting our mortgage and PMI paid for every month with the help of a roommate. Luckily we sold the property to a buyer who was desperate to get into this particular complex and was receiving grant money from our state government to cover her down payment. We made about $5k on the sale after everything was finalized.

Lessons learned? Challenges?

Townhomes and condo's can be risky investments since you have to pay an HOA fee each month (if not more for special assessments occasionally), and you may not be able to find someone willing to buy the property for several months. We were fortunate to find the perfect buyer and got out quickly with extra cash in our pockets.

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

Barrett Goff with Family Realty in Louisville, KY!

Thanks

@Bryan Blankenship I definitely will!  Appreciate the encouragement!

Investment Info:

Other buy & hold investment in Louisville.

This is a 1 bedroom condo with a loft area that we use as for long term rentals.

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

This was a great deal in a great complex which is also in a very popular are of Louisville, Ky.

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

We found the deal online and allowed the selling agent to represent us as well, and then told her that she needed to sell our low ball offer to her client in order to get the deal done. Since she knew she was now getting a bigger commission, the selling agent pushed our offer to her seller and we got the deal done a great price.

How did you finance this deal?

We financed this deal with a 5 year ARM loan and 20% down. We intend to pay off the remaining amount of the loan prior to the adjustment period.

How did you add value to the deal?

We have had to do very little to this property. We pay a $120 HOA fee monthly and the property management company has done an excellent job maintaining the grounds and the buildings.

What was the outcome?

We receive premium rent for this property and have very little maintenance or headache.

Lessons learned? Challenges?

Do not allow your tenants to use your washer and dryer. Make them purchase their own if you have hookups in the unit like we do.

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

Barrett Goff with Family Realty in Louisville, KY!

Investment Info:

Single-family residence fix & flip investment in Louisville.

This home was built by my grandparents in the 50's and has been in our families possession ever since. After my grandfather passed away I purchased the home from the family estate and renovated it completely. Between taking out walls, renovating a bathroom, adding a bathroom and finishing the basement, I have turned the property into a cozy little house.

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

This was an easy decision for me as I wanted to carry on the legacy of my family in this neighborhood, and with such a short supply of deals in our market currently, it was a no-brainer for me to buy the home.

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

Negotiating with family is never easy, and you have to tread lightly. I bought the home with $10k of equity built in, and didn't push for anymore than that.

How did you finance this deal?

I financed this home with a 5 year ARM loan with 20% down.

How did you add value to the deal?

I renovated the home from top to bottom, and also registered the home with my city to begin hosting on AirBnB, VRBO, etc.

What was the outcome?

We have had a lot of success with this project in terms of adding value and building equity. The neighborhood as a whole is increasing in value each year and this will be a property that I hold onto for as long as I can.

Lessons learned? Challenges?

Working with family on any deal will have its issues. Keep calm and run your numbers. If the deal works great, if not, move on. No property should be sentimental and unfortunately I have fallen victim to that reality.

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

Barrett Goff with Family Realty in Louisville, KY!

I was loan officer (lo) for a while during the recent refi boom for a couple of different companies.  I worked in Kentucky but was licensed in most states and did the majority of my business everywhere but Kentucky.  With the first company I worked for (Discover ((yes the credit card company))) I was paid in bps.  That amount was a fraction of the loan amount, but nowhere near 2%. Our commissions increased based on the number of loans closed per month, and the volume of those loans.  The rate we charged along with origination charges had no bearing on my commission so I was always offering our best rate possible.

The second company I worked for is a smaller family owned company that operated rather differently.  I was still paid bps on the backend of the deal, but I was also able to sell higher rates in order make more money on the front end.   Basically any money I could make for my broker, I got to keep a percentage of it (ie more interest, more money). This was a similar model to the pre-2008 market collapse, but with many more restrictions.  

Different companies/brokers operate differently but if you are dealing with big banks then they are not making 2% on your loan.  Small banks and brokers aren’t making 2% either, but are most likely making some money based on your rate and fees.

Hope this helps,

Barrett