All Forum Posts by: Charles W.

In addition to the BP community, I've been considering joining a local REIA. I am in the Maryland/DC area, and there are about a dozen advertised organizations on reiclub.com.

What things do you look for in an REI group? What are reasonable costs of membership? What benefits do you expect to get from these meetings/groups?

Before I start driving all over the state and spending money to preview the clubs I'd like to have a better idea of what it is I should expect for my money and my time.

Also in terms of deviating from the mean, think about how much it costs you every day the unit is empty. Odds are that the higher rent you are holding out for will be eaten up by the days (weeks) it takes to find the renter willing to pay the premium.

It may be that your unit has better amenities, but that those particular amenities aren't all that important to your renter demographic. Then again, it might be that those amenities you have make it more than worth it to pay a few extra $$ and you could rent it just as fast... Unfortunately it all really depends on your market.

I think for the purposes of evaluating a potential deal I would put market rents where I KNOW I can rent for (IE. below the mean). If the picture looks good for that it only gets better if you can raise rents above market.

Welcome Jarred. Whatever your questions are... this is the place to find the answer.

Lisa,

I would think to get an accurate picture of the financial health of the deal you need to account for the 278k you will be using to purchase the property. Even if you are servicing the debt on another property, you would not have the debt if not for the new one.

If it were me I would treat the 287k that you now will be paying back on House A as debt service to House B. It just happens to be secured against a different property.

I did a quick search on this book. Which version do you recommend? Has anyone else used these and found them useful?

Will,

Thanks so much for sharing that. I think as a newbie it is easy to gloss over 'little' things that really can add up. Just looking over your form I saw lots of things I don't think I would have considered otherwise.

The way you broke it all down I can see how the material cost estimates really take care of themselves. Labor on some of these items seems like it would be tricky, but you've given me a great place to get started. Thanks again!

I've been searching for my first property to put under contract. It seems like there are two major hurtles to making sure you buy a property right. Accurately estimating ARV and repairs. As someone new to all this, I'm having a lot of trouble getting a 'real' or even close to real number on repairs without having a contractor/inspector there to tell me what is wrong and how much it will cost to fix.

Since I need to have a good ballpark prior to making an offer, I'm feeling a bit lost. I feel like I'm in a chicken and egg situation. I have no inspection until the property is under contract, or contractors interested in looking at a property I don't yet own... but I can't make an offer since I don't have any idea what the rehab will cost.

I'm hoping some of you more experienced guys can point me in the right direction on this. How can I at least get in the right ballpark for rehab costs? Since this will be my first property, I'm looking for light rehab only to get my feet wet. I am only looking a builds post-lead paint, mostly townhouses. My goals are buy and hold rentals long term.

Thanks for all suggestions!

Thanks for the reply Chris. These terms are pretty unfavorable for long term buy and hold. It sounds like the best alternative for an LLC is private contributions.

Hi all,

I've been trying to do my research into commercial lending terms. Based on all the threads on LLC vs operating in my own name I have decided it is probably best to operate under an LLC. Since as an LLC I cannot use conventional funding I've been speaking to local banks about commercial loans for doing my acquisition and rehabs.

I have spoken with several local banks who do renovation loans and have been a bit surprised by their terms.

The terms from both local banks have been a 5 year loan, 20 year amortization with a maximum loan of either 65% ARV or purchase price + rehab whichever is lower.

Are these terms consistent with what others have found? I am looking at loans between 40-60k. I was expecting I'd be able to get closer to 80% LTV on the ARV.

If these terms are pretty standard, how do those of you operating under LLC's fund your deals if not with commercial loans?

I should also mention I'd like to primarily buy and hold only using fix and flip to generate my down payments for more buy and hold.

Cheryl,

Thanks for clarifying that. Looks like I was misinformed.