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All Forum Posts by: Andrew Beckmann

Andrew Beckmann has started 2 posts and replied 3 times.

Post: How to fund large rehab

Andrew Beckmann
Pro Member
Posted
  • Omaha, NE
  • Posts 3
  • Votes 4

Hello BP community

I'm looking for advice from some of you seasoned/experienced and savvy investors out there. 

I am a newer investor with one property at the moment. A 4-unit house hack I bought last year with FHA loan in Omaha NE. I am now ready to buy another property with the same house hack/FHA strategy. I have been looking in Austin TX as I am planning a move there.

My realtor found a 4-plex for me at a discounted price because it needs a LOT of work. 
The asking price is $675. It's hard to find comps nearby for a 4-plex and updated small MF properties but based on a few recently sold duplexes and a triplex within 2 miles if the price per sq ft is extrapolated (range $280-320 per sq ft; property I am looking at is just over 4000 sq ft) ARV is potentially $1,120,000-1,280,000.

I obviously plan to get estimates from a few contractors but based on videos and photos of the property one estimate I got is it may cost $200-250k to update completely. Again this is a quick estimate and I will have contractors actually walk the property to get more accurate estimates. 

The question I had is, what is the best (or some best ideas) for how to pay for such a large rehab if in fact I would purchase the property?
I have the capital to cover the loan down payment but certainly not that big of a rehab. My mind keeps thinking of one of the mindsets/quotes to change from thinking "I can't afford this" to "how do I afford this," and that is where I am hoping those of you with much more experience can help me. 

Some thoughts I did have were to stretch out the rehab and cost. I will likely just rehab one unit at a time which would work well as one unit is open now and the rest are filled with tenants on month-to-month leases. I know I have heard people talking about using PML, hard money loan, interest free credit cards but I'm trying to figure out what might be the "best" strategy or ideas that I'm not thinking about (loan from my 401k?). I don't have enough equity in my first property that I can use a HELOC. I didn't really want to use a FHA 203k loan given it is so much extra money I would then be paying interest on for 30 years and with the higher rates today, though maybe I'm wrong?

I appreciate any input/advice! This is a great community to be a part of and I realize I need to lean on it more for guidance. 

Post: Nurse contract cancelled days before move in

Andrew Beckmann
Pro Member
Posted
  • Omaha, NE
  • Posts 3
  • Votes 4

Thanks for input. Learning experience here as I typically had security deposit paid with first mth rent but will now make that due with signing of lease. Also, I responded to the potential tenant about paying first mth rent and she understood so surprisingly no push back. I told her I would gladly pro-rate her rent and refund her if I get someone in sooner than a month. As for timing, in Omaha with this unit so close to major hospital, booking lead time is typically less than 2 weeks for me. In fact I relisted the unit this morning and already have 2 inquiries through FF to move in within 2 weeks. Thanks again for the help!

Post: Nurse contract cancelled days before move in

Andrew Beckmann
Pro Member
Posted
  • Omaha, NE
  • Posts 3
  • Votes 4

Hello BP community!
I realized I need to utilize this resource more when I have situations I'm not sure how to handle as a newer investor/landlord and could use the input/advice of a group of experienced people. 

Here is the situation. I have a MTR. A nurse has signed her lease and is set to move in tomorrow.
I just got a message from her with this scenario:
She had hip surgery in Sept. She was having hip pain so on her way from last contract (Colorado) to new contract (Omaha) she stopped in to see her doctor in Colorado. She was told the hip is not healing well and she needs to be on light duty. She contacted hospital to see if they could accommodate and was told no so her contract is going to be cancelled. 

I feel bad for her, I really do, and yet the lease has been signed and states:

Notice of Termination:
24. If Lessee(s) intends to vacate the Premises at the end of the lease term, or if the lease is month-to-month, Lessee(s) must give at least 30 days written notice prior to the end of this lease, or prior to the date of intent to vacate. If 30 days notice of intent to vacate is NOT given prior to lease term or date of intent to vacate, Lessee(s) are responsible for the equivalent rent amount due for the 30 days after notice is given.


What would you all do?
Do I release her from the lease and just try to get unit rented ASAP?
Do I ask her to pay the one month of rent?
(FYI no rent has been paid yet. It would be due today)

Sorry for the long message but wanted to get all the details so others knew the full story. Thank you all for your help!