All Forum Posts by: Brennan Crick

You should do a 203k loan. That way you can finance the rehab with a 3.5 % down and on top of that you can get grants and down payment assistance to go towards that 3.5%! Let me know if you need help. I’m an investor myself and rehab my own homes. Let me know if you want to chat about the areas here. I live in the city too. 

Hello and happy new year, as you know it’s all about numbers in any market so it’s solely based on your buying power in what communities you can buy in. But typically I would start 30 to 40 mins outside the city in the suburban areas. The trend now is how to buy creatively instead of paying high interest rates. A key example would be to find a property who has a fha loan that you can take over (assume the loan) and use your down payment for cash for the difference. but making sure your margin is good enough to cash flow after ALL the expenses has been accounted for. (Maintenance, trash, water, cap-ex, tax’s, PM, and vacancy)

It doesn’t really flood here. Although there are flood zones in the suburban areas, but there hasn’t been a flood that was damaging. Where I am in the city, the solution to that to combat moist and wet garden units we use a drain tile system. You can combine that with properly drained downspouts from the gutter as well. The drain tile system is basically a 4” corrugated drain pipe that’s underground of the parameter of the property that links to a sump pump the pumps the access water to the sewage drain pipe. That keeps the garden units or finished basements dry and inhabitable. Most cases you will have to install that during your rehab if you buy a property to invest in. Unless you bought a property that’s renovated recently. 

@Leo Previllon it’s a good rule of thumb to fully understand the exit strategy in a deal before you even get financing. So make sure to do a refi is you have an instant or forced 30% equity in the subject property. 

So with the refi in mind you need to know what LTV you can get and how long you need to "season" it. That means to rent it out to for a period if time so the bank can use an income approach for appraisal to determine value. Sometimes they just use the sales comparaison to determine the value.

So you need  to take in account holding costs for seasoning, rehab and 2x closing costs and fees. If you have a deal that can cover all that in the equity after you buy it and after stabilization , you got a good one.

best if luck to ya!! 

@Jia Liu yes this is very common in the city. I work with investor buyers all the time and most multi unit have a nonconforming rented basement unit that they can invest into. An another option for this situation is to sell “as is”and disclose that the garden unit is non conforming. The sale price would have to be comparable to only the similar properties minus the basement unit. Let the next investor take the work load in converting it or making it legal. The seller would have to take a Invester buyer that offers cash , hard money or conventional loan options. This would be the easiest way.

@Kean Chew

a basic ARV is the comparable properties sold around the area. Similar beds, bath, structure and sq ft. If you can add a bedroom within that amount in the basement or something like that would put you in a higher Comp bracket. Or even a half bath would add value. But it's going to be tough with that amount of money to contract out. 6k alone might just cover materials.

Check your lease and see what is says about non-entry. It will say how many days you must wait until you legally use a locksmith to enter in your units under emergency. You must mail in writing you notices as well. 

Furniture does not effect the value of a property. Appraisers don’t care about the personal property in the home. Just the practicality of the property like if the basement is finished , square footage, and how many bed/baths there are compared to other properties.

@Joe Splitrock Well it’s all the sellers side to see if they want to undergo a 5th extension. I’m trying to ride the corse of action as long as I am permitted. 

@Jay Hinrichs yeah, but revising policy a days before closing isnt good practice. I would expect everything at initial review. Once the deal and personal review is done AT FIRST then tell me what I will need to secure the loan. Not wait a month and then ask for more documentation to try to re-qualify. its absurd!