All Forum Posts by: Camron Cottam

Investment Info:

Single-family residence other investment in Oakville.

Purchase price: $54,500
Cash invested: $97,500
Sale price: $214,000

Completed BRRRR that yielded great results. Single Family Residence that I purchased off of auction. ARV of $214,000 with $97,500 total invested. Utilized a private investors capital for the purchase price. They received their capital back + interest in 6 months time. Cashflow of $400 a month.

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

I found this deal listed on the MLS. Was able to take a look and then I was notified that it had gone to an online auction.

How did you finance this deal?

Private Investor

How did you add value to the deal?

Full rehab

Curious about this as well- if you have any info please share 

Thanks for the response David. I am not using hard money though. I have an individual who will be providing the capital for the purchase of the home

How do you make cash offers on properties that require proof of funds when you are using a private money investor? I am working on my first deal with a private money lender and using the BRRRR strategy.

Will I need them to provide me with their bank statement? Does it matter that it is their name on the bank statement and not mine if I am purchasing the home under my name? What if they are not willing to provide a bank statement? 

I want to say first and foremost that I am not 100% positive that requirements are exactly the same for just an FHA loan vs a FHA with the 203k loan for rehab costs as well. Maybe someone else can confirm this?

But for your standard FHA loan they want to see things like no chipped paint, a roof with at least 5 years of life left, that the home is in livable condition, and pretty much just that there are no major issues with the home. For example if the home has structural damage or needs all new electrical you will most likely not get approved for an FHA loan. Consider this when you're looking at homes and planning to use the 203k loan.

Another thought is maybe you don't need the 203k loan? As I said before, to get approved for an FHA loan the home has to be in at least livable condition. You also are required to occupy one of the units for at least a year. While you're living there you can make improvements as more money starts to hit your bank account. After all a smaller loan = smaller amount of interest paid = smaller monthly payments = more cashflow.

Don't be discouraged by the comments above. While there may be some truth to them, there are plenty of people who have used this strategy (myself included) and made money doing it. 

fyi for anyone following the thread:

I got title insurance and determined it was definitely necessary.  It's also less than 70 bucks where I'm at.

Thanks for all the input everybody. In other words everyone here says it’s important to get title insurance. But sounds like even without it the problem get resolved. I’m not convinced yet honestly, but I’m going to get a quote and decide. The property is in CT and it’s not required.

Title Says it all: Should I get title insurance?

Does what type of deal you are doing effect if you should get title insurance? For example I think it would be a good idea to get title insurance if you are buying a foreclosure, but what if your not?

Alright, so I'm finally ready to dive in and I'm curious what you guys think about my potential first buy...

Let me start with a little background of the situation I am in so I can paint the picture;

I am graduating college this week and got a job about 3 hours away from where I currently am. My start date is a coming up in mid to late June. So I need to move out to that area ASAP. I will be going the FHA route and obviously will be owner occupying the property.

I went to look at properties this past weekend and got a feel of the area and saw just about everything that is currently on the market within my price range. Most of my options were in areas that are too rough for my personal taste and in my opinion, would attract some pretty rough tenants along with it. But there was one property on the outskirts of the area that I particularly liked, it is in my price range and I feel strongly that it would attract the right type of tenants. 

Looking at the numbers:

Purchase Price: 210K

Money Needed: 11K

-Downpayment: 7.35K

-Minor Repairs: 3K

Unit 1: 2 Beds 2 Bath 

-Rent: 800 (Renting a room in the unit I would be living in)

Unit 2: 2 Bed 1 Bath

-Rent : 1100

**Rents are conservative numbers

So here's why I want to see what people think:

There's no cash flow on the property. Using the rental calculator, I came to about breaking even each month. My numbers are very conservative, but even so I expect for that to even be negative cash flow on some months. The only reason I am considering this is because of my other options. Like I said, I need to move out to the area asap. So if I don't buy, I have to rent. Which I feel would be a waste of money. My plan is to move out of the property after year one. Once I move out of the property, I would be looking at a cash flow between  500-700 a month, depending on what I could get on rents. 

Is this something you would consider buying, or would you stay away because of the cash flows?

@Harjeet Bhatti Thank you for the response! Much appreciated. I will definitely make sure I know all of my options.