All Forum Posts by: Carlos A.

Yes, I am the only person on title right now. It’s legally my home. However, in the purchase contract, we agreed that the seller would “rent” the property from me for the next 5 years covering basically everything except P&I. 

To be honest, I need to get more educated on the financing part of things. Im not well versed in what a “bridge loan” is? I cant wrap my head around refinancing and still being able to cover the mortgage? @ the current payment, yes, i can cover it no problem. But if I were to do a cash out refi, and my payments double…idk if i can pull that off. 

 I am certainly open to it. One of the main things that I have realized though is that the Toledo market (and markets similar to Toledo) are much more reliant on cash flow compared to appreciation. Although I love the monthly cash, I am torn between scaling the amount of properties in Toledo or purchasing fewer properties in much higher appreciation markets, like south florida...

Hello everyone, I hope you are well.

Quick snapshot of situation

I was fortunate enough to find a deal in the south florida market (Fort Lauderdale) where the sellers were looking to retire but were house rich/cash poor. They had a crazy affinity to the home they've lived in for the past 30 years (family roots, love the neighborhood etc) So I was crazy enough to offer them $100k over what they still owed on the property....and they  accepted! Here's the catch, they told me they would only agree to the deal if I allowed them to live in the house for the next 5 years. They would pay the taxes, insurance, HOA and all maintenance/repairs, and I would pay the P&I.

Numbers

PP: $250,000

Actual Appraised Value: $750,000

Monthly P&I: $1,660  (Which I do not have any issue paying monthly) 

My question...

I know that this is a very unusual situation, but I was looking at the equity in the house and the appreciation that market has seen and couldn't pass up the deal for that PP. Is there any way to leverage all of that equity now? My idea is to use it for BRRRR or Fix and flips. Or Do i just have to suck it up for the time being, float the loan and in 5 years get a big pay day?

@Engelo Rumora the rent is right around $1000 combined. To be completely transparent, it took a while to get the cash flow that we have now. The first 6 months or so there were quite a few maintenance items that popped up, cutting into that monthly cashflow but as of a couple months ago the property seems to have stabilized. 

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $82,000
Cash invested: $17,000

Early 1900s duplex located in Toledo, Ohio. Was in pretty solid shape when purchased with long standing tenants.

What made you interested in investing in this type of deal?

I was looking for a cheap way to get started in oos investing and small multifamily properties. Killed two birds with one stone.

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

It took me about a month to find. We were able to talk down the purchase price due to some simple fixes needed on the property.

How did you finance this deal?

Conventional financing.

How did you add value to the deal?

We increased the rent day 1 and redid the electrical work.

What was the outcome?

Was able to pay down the mortgage quickly and now cash flow handsomely.

Lessons learned? Challenges?

Cheap real estate isnt always the best way to get started. Look for equity growth and purchase based off total ROI not just cashflow.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Yes! Andrew Lee helped me find, purchase and manage the property!

Investment Info:

Industrial industrial investment investment.

Purchase price: $120,000
Cash invested: $25,000

Found the property on FB marketplace. Seller financed deal, 10yr note, 30yr Amortization schedule @6.5%

What made you interested in investing in this type of deal?

It was my company's first rental property purchase. Deciding to just jump in the deep end and learn as we go!

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

FB marketplace and the seller was very motivated, in need of cash.

How did you finance this deal?

Seller financed the deal

How did you add value to the deal?

I completely rehabbed the unit. It was built out without permits, so I demo'd the entire interior and made it an open workspace

What was the outcome?

The outcome was being able to raise rent from $1100/mo to $1500/mo!

Lessons learned? Challenges?

I learned that if you are open minded and willing to go outside of your comfort zone, there are deals to be had.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No this was a direct to seller transaction