All Forum Posts by: Chad Nagel

You need to determine if the juice is worth the squeeze.  Figure out how much the rehab will be and how quickly you can return your cash you just invested into said rehab. It also matters if you have the cash to rehab or not. If your borrowing on credit cards to do rehab may introduce a different risk vs rolling benjis on the bills. 

32k combined NOI (assuming your figured your NOI properly with out debt service)- 42k in debt= -10k year carry (not prolly figuring in any cap x or vacancy). As I steal a line from the rich dad book, how many deals can you continue to buy if you buy deals that lose money vs ones that cash flow.

@John Franczyk  Be careful playing the "speculation" game. As the investors in miami how that turned out for them. Dude if you willing to accept the worse case scenario on the property buy it. Only buy properties that cash flow to your biz plan... Biz plan you say.... If you dont have a minimum cash flow requirement on a plan, I suggest you get one. It creates a baseline and prevents posts like this on BP.  

Who has determined it is mold? Is the tenant educated in determining mold types, are you?  At this point it is water discoloration and can be dealt with as you see fit. Clean with zinsser perma wash or jomax, then paint with a moldicide type paint (if you think it will be a future problem) or normal paint is fine. Problem solved. Some leases even state that water discoloration in a bath is tenant responsibility due to cleanliness and lack of using fan/window. 

I have done LC and held mortgages for people.  I require 10% down minimum and usually 10-12% interest. I had one guy put down 50k on a 60k deal. I held back the 10k note at 10% for 3 years. I highly doubt the seller will consider a no money down approach and 3 months no payments.  If I was that seller, I would think you dont have 2 nickels to rub together and wonder how you will fund/complete the rehabs on 200 properties in less than 6 months.  Taking down a 200 property deal is pretty big deal. Good luck.

@Kevin H. Create a plan that works for you. Maybe buy 4 rentals but mix in 2 flips. Those 2 flips can keep you purchasing more rentals supplying your DP money. Then if your not finding deals ( maybe in top heavy market, that we may be in today) you continue to flip fast ( less time for market adjustment) and use profit to pay down rentals and build LOC so you can purchase more when deals come up.

Many like to play this game Fast and Loose ( always taking all the cash out to spend personally) but they are the first ones to B!tch when the market turns and the bank now owns their rentals thru the foreclosure process.

I used credit to build my portfolio, I am up to 38 rental units. Started at age 20, currently 36 years old ( semi retired living off my units). Once I started flipping 10 years ago ( yes I flipped right thru the downturn), I used the excess profit to pay off rental units and build LOC. This has allowed to purchase new rentals and flips with LOC cash and not have to ask permission from a banker or deal with private or hard money. There are many different way to get to the finish line. I prefer mine to be with paid for rentals, so WHEN ( not if ) we have a down turn. I am not caught swimming naked like the rest of the investors that bought when the market was hot and no longer have equity to refinance.

Feel free to bash away, this forum is built on the OPM strategy......

Maintenance of $1320?  

I understand you from cali, but you will spend close to $1300  just in snow removal for winter time, if we have a bad winter, not counting lawn care expenses in the summer. Don't forget cap x/ repairs in budget as well. This is a 1% deal its average nothing special.  

Are you talking about auburn lake in SE FDL county? I used to live on that lake. 

Im playing in the Port charlotte / north port market. Not many deals to be had at this time. Buyers are back to overpaying for deals again IMO.