All Forum Posts by: Brett Hearn

J Scott 

What if you are casing the ARV for a cash-out refi. Then the refi-lender will send an appraiser and go from there correct. I'm getting a place for $77k, plan to put about $5k into it and refi in 6 months. I think the property is already worth 90K as is but hoping to get an ARV of $115K. There is a place just down the street that went for $130K of course it is in better shape, but it's about the same age house and the same sq. footage, but it has a back yard. I know there are a lot of factors but I'm I being realistic with my projections? Thanks, and sorry for adding to your post Alejandro Flores!

Hi Senika,

I'm an ED nurse in the Bay Area and just wanted to tell you how very sorry I am to here about your daughter.  Yet, I also wanted to tell you, even though I don't know you at all, how proud I am of you for picking yourself up and knowing what you needed to do in order to make yourself happy.  I love what I do, but I can empathize with you about the stresses and demands that are put on nurses.  I've been doing it for about 3 years now and already know that I don't think my mental capacity can handle the job for another 35 years!  I just want you to know that your in my thoughts and I'll be pulling for you.  I just got my first place under contract in the central valley where I grew up, and I'm using the income from my nursing gig as a means to and end.  It's just a thought but the reality is we do pretty well as nurses up in the bay area and have flexibility of working 3, 12 hour shifts a week, which leaves us with a lot of room to work on our side hustle.

The great part is, if you ever run into a situation were you need a little extra cash, you can always pick up a per diem gig and make a little extra on the side to supplement your RE journey.  I think the future is bright for you and your sisters, so go rock it!

Hi everyone,

So this is my first deal and I'm doing my best not to get cold feet. I plan to purchase the property using hard money at $77K then put about 3 months of work into it spending about $5K. Property is currently under contract. I will be doing most of the work myself and if I run into a snag I will delegate appropriately. I then plan to refi in 6 months into a conventional loan hopefully achieve an ARV of $115. I plan to rent the property for $850, at the 3 month mark. I have budgeted for the reno accordingly, but my only concern is the kitchen. It is not in bad shape but is it worth the cost benefit of chasing the ARV by putting new cabinets and a new table top? The current cabinets could be refinished and the tile grout could be scrubbed and redone. the sink is stainless steal that would just need a little water sealant around the edges. I could refinish the ones I have and get a renter in there no problem but I'm thinking that I need to act like I would be selling the property in 6 months if I really want that cash out refi, which at 70% of the ARV would be 80500, or more if the ARV is higher. Plus, is the extra work and capital worth putting in the cabinets if it is not going to make that much of a difference when I do the refi?. Much of my work will go towards the curb appeal which my dad an I will be able to handle. The property is in a C+ to B- area. A property down the street with the same sq footage sold for $130K. The only difference is it has a backyard, and of course they upgraded almost everything. I looked at the pictures of the inside on zillow and it seems to be the same age home as well, older home, but they defiantly upgraded the kitchen. Any kind of advice on if the cost benefit is worth putting in the cabinets would be greatly appreciated. See link below.

https://www.biggerpockets.com/calculators/shared/605051/a8e239aa-ed65-4bda-82ec-b47b6a35702d

If you can not see link please let me know. 

Anthony barbato and Chris Mason, thanks for your replies. I was told that if I wanted a cash-out deal I would have to wait at least 6 months, but if it was a straight up refi, there really was no seasoning period (Quicken and another local lender gave me this info). When it comes to Overlays, I'm hoping that since my W2 income is high that this will not be a problem when it comes to DTI. The property is being inspected this weekend and I'm doing my best not to get cold feet. I have to admit I'm worried about the refi process but I suppose I'll just have to roll with the punches.

Thanks for the help guys.

Brett

Hi everyone,

So here is the deal. I have a property under contract for $77,000.00. Its not a terrible unit in a C+ to B- area. I'm using a Hard money loan to purchase at 10.5% interest only , with some fees, then plan to put about 5-6K back into the property to refinance in 6-7 months at a conventional 5% amortized over 30 years. I plan to bring the property to an ARV of about $115,000, and rent the property for about 800-850, and use the cash-out refi strategy. I have talked to lenders in the area and say that I should not have a problem refinancing if the property is in "decent" condition and my credit score and income are both ok, which they are. I see a lot of people talking about DTI and I'm not sure if I would need to worry about that when it comes to refinancing. Any other suggestions on the deal would be helpful. Thanks

Hi Paul,

I'm a brand new investor who lives in the Bay Area.  I grew up in the area and still have family in town.  I am currently working on pre-qualifying to purchase my first rent and hold property as I believe the margins will work pretty well in the market.  Lemoore, just down the road to the west, is also a good market to look into as the Naval base is getting ready for a huge infusion of service men and women and have some incentive to live off the base because they receive a stipend for living funds.  I have not made any official offers but plan to stick to the numbers that work.  Once I start making offers I will know more about how motivated sellers are in the market.

Take care. 

Welcome Maria,

I just joined up a couple of months ago as well, and educating my way to success.  I was hesitate about becoming a PRO member, and I'm definitely not promoting, but the analyzer itself has really helped in learning the math and numbers in the market.  SF area is a hard place to find the right deals, on top of having the cash or means for down-payments, but I'm looking elsewhere in the country and the state. All the while still being diligent in our local areas.  I work in the East Bay, in Castro Valley in fact and have family there, so I know how it is.  We'll get there!  Analyze some deals, use the equity in your current home (if its paid off and the deal is perfect, because its a big risk), and don't quite.  Put your time in and then take that leap!  Good luck!

Thank you Jay.  I'm hoping that he will still be familiar with Kings County Codes.  Off the top of your head, would you know about what his rate is?  Thanks again. 

Brett

Hey all,

I'm just throwing it out there if anyone has a good RE attorney that they have worked with in the small town of Hanford CA.  I've had some good references so far, but want to analyze all prospects.  Thanks in advance.

Hi everyone,

I just wanted to update you and let you know that after considering your replies and careful consideration, I decided not to really case the deal that I was "forcing"on the 5 unit property.  After running the numbers, in all sorts of situations, I came up with the property would have to be owner financed and price dropped to about $250,000.  Or I would have to raise the rent on each of the units by about $150/month.  I'm guessing that both are a lot to ask with not a lot to offer so it is time to save and keep educating myself.  Thanks again for all of your time.

Brett