All Forum Posts by: Tiffany C.

@Michaela G.

The expenses are as follows - taxes 142.30 per month, insurance 107.80 per month, Cap X my estimation was $230, repairs $161, vacany $115, property management $253 and I apologize I did not include water $200

If someone purchased this property cash they would cash flow $12090 per month/ $322.50 per unit. I don't have the cash but I do have the down payment. I'm just trying to figure out the best route to finance. She currently has no cash flow because her interest rate is so high. And she isn't currently accounting for all of those other expenses. Those are based on my own research so if those expenses are less in reality the buyer would have even more positive cash flow. So that's why I said I could wholesale it. Even if they got a mortgage if the interest rate were at 6 - 6.5% they would still cash flow. 

Thank you for your feedback!  

I've been working on this deal since Jan. The seller is a tired landlord. 

Here are the details: 

4 units 

The property is valued at $150k (I got a brokers priced opinion)

The seller owes $102,000 and wants $10,000 to walk away from the property. Initially she wanted $150K but dropped the price once we discussed the comps. It was extremely difficult to find any comps for this property. 

Market rent with all four units rented is $2500

The monthly expenses are $1010 (this does not include the mortgage)

Her current mortgage is $1300 (PIT (it doesn't include insurance but I included insurance in the expenses) and her interest rate is 8.75% 

The property needs a roof. The bathrooms and kitchens are outdated but fully functional.

I've done subject to before so I offered to take over her mortgage in order to do repairs and get each unit up to market rent. As I mentioned previously, she wants $10,000. If I pay her $10,000 to get in the property and inform the tenants of the rent increase (1 unit is currently vacant); if any of the tenants decide to move I'll have to repair those units while also having to pay for vacant units. 

If we go out and get my own financing , say a hard money lender to eventually use the BRRRR strategy? They only finance up to 65 - 70% of ARV (165,000) which would be 107250 - 115,500 so we would have to bring $4750 at 65%ARV. Would I also have to pay a down payment in addition to that? And I would have to personally finance any repairs on my own.

If we got financing from a portfolio lender I know it's typically 75% - 80% LTV. And what is a typical down payment for a portfolio lender?

I really want this property, but if it's a bad deal I'll have to try to wholesale it or walk away. What are your suggestions? I welcome any useful feedback.  

@Daryl Askew I will Private Message you

@Aaron K. Good luck on flipping. I really want to flip!!! That was my initial plan when I started but I'm having a really hard time understanding the flipping market on the southside. I had found a partner on here who wanted to flip in Gwinnett but since I live in Henry county we compromised and placed our focus on Decatur. We didn't move forward but I did have to do some market research in preparation. Decatur (most zip codes in Decatur not just the expensive ones) seems like a solid area to flip. Ellenwood even has some communities that I would flip in. Rex seems like you would have to get a deeply discounted property with an ARV in the 80ks - low 100K+ (with a possible exit strategy of selling to a turn key investor buyer).

@Daryl Askew I'd be interested in connecting! I need a contractor for a property I'm considering.

@Aaron K. I apologize for the late reply. I had not heard of those developments so thank you for the insight. Now that I have some actual experience under my belt, I'd invest anywhere on the southside if the numbers make sense. I just bought a single family in Hampton/Lovejoy. I had over 50 renters call me within the first week. My realtor informed me there is a shortage in rentals on the southside. Many people are suffering from credit issues from the market crash and can't qualify to buy. So to answer your question, I think it just depends on your personal strategy. If you are looking to build new construction in an area that is going to have major commercial developments, great plan. I guess you have to time it properly. If your strategy is I think Rex and Ellenwood would be good options. If you decide to move forward on something down here please keep me posted.

@David BegleyThank you so much for this post! And providing great feedback over such a long period of time. I read the information you posted about how you and you partner created a GA LLC and your individual entities were the members (parents) of the entity that you formed together. Did you set this up or did you use an accountant. The reason I am asking is because 1. I live in GA and 2. I just formed an entity for a buy and hold investment but when I did the filing online with the Secretary of State the system did not allow me to list my other entity, (one that I would like to be the holding/parent company). I called and they said that an individual had to be the registered agent. So my question is how did you get your first entity to be the parent company to your second entity? Did you do it under the articles of organization or did you do it with the IRS when you obtain your EIN? Thanks

@Chris Virgil-Stone, oops forgot to tag you above.

I grew up in the area and I'm still here (not 138, but Henry County). I know most of the multi families that are on the market. In my opinion they are overpriced. Are you only open to Henry County for a multi family? 

High demand is in the Union Grove School District. It's the top school district in Henry County. Lots of new construction.  Ola, Locust Grove, and McDonough are places most families desire to be. North Henry County, the school system isn't good. Henry County market trends for owner occupant are dictated by the school districts. 

The corporate giants purchased and are still purchasing very heavily in Henry County. They are purchasing buy and holds. There are still alot of short sales!!! It's somewhat of a sellers market so SFH are overpriced.

North 138 is sketchy but honestly you'd be okay investing in the area. It's not terrible. I think it's a good rental market. PM me, I don't mind giving you insight on the area and recommending some RE Professional who can better assist you.

If I were looking to acquire multifamily in Henry County I would consider downtown McDonough, I would consider Stockbridge (it really just depends on the exact location but again Henry County is not the hood).  There may be brake ins here and there but I'm not afraid to go anywhere in Henry County alone during the day.) It's not Atlanta. 

I would even purchase  buy and holds in Clayton County (especially downtown Jonesboro). People give Clayton County a bad rep. The school districts aren't good. There are some rough spots (especially North Clayton County. no, no) but Jonesboro and Hampton your properties would stay rented. My parents own 3 rental properties in Clayton County and have never had a problem keeping them rented. And there is more inventory and reasonable prices for investors.

@Anthony Certonio are you still looking for a realtor. If so, I know one who is investor savvy and works in the area. 

@Pyrrha Rivers I'm a new rehabbed and I'm in need of a good contractor recommendation. I would greatly appreciate a recommendation!