All Forum Posts by: Chase Harmon

Thank you all! We have earnest money that has gone hard but was hoping to free up the equity sooner rather than later. Looks like we will need to wait it out.

I have 2 properties that are beside each other in an area that is undergoing substantial development. We have been contacted by a developer who has our properties under contract. His plan is to demolish both and put in a development complex. He submitted plans last year and did not win the city bid. However, he is looking to keep us under contract as he and his team are confident they will win next year. If the sale goes through, we are making a substantial return (hundreds of thousands of dollars).

My spouse and I want the money now and want to avoid the wait and see. For experienced investors, do you see a scenario where an investor would assume the properties at a reduced rate which would allow us to cash out and them the opportunity to earn some easy money while holding the properties.

For example: Say if we wait, we will sell the properties for $1M. However, we find an investor to purchase the properties at $900k. We will lose out on $100k but get our cash out and the new investor will clear $100k by sitting on a deal for a year (while collecting rents).

Does this seem feasible or something that would be attractive to an investor?

Hi All - Wanted to give an update that I think I will be going with the FHA Title 1 Home Improvement loan as it seems to be the path of least resistance for what we are looking to do!

Thank you all for your help and hopefully I can repay the favor in the future.

Thanks all for the insight thus far!  

One item to add is we purchased the home ~$80k or so under market value.  So, the idea of rehabbing the top(which should be finished in a month or two) and then taking a loan out after getting a new appraisal seems logical but I am not knowledgeable enough to know if this practically makes sense.  As mentioned we have strong monthly incomes so basically we want a   loan to front the cost of the rehab on the second unit which we will pay off in 5-7 months.

@Chris Mason and @Eric Veronica - I am aware of the FHA 203K and the Fannie Mae homestyle renovation mortgage. However, I was under the understanding that those two options are primarily for those who have yet to purchase a home. We closed 2 months ago using a conventional loan to ensure we weren't locked in to MIP or having to refinance if/when rates go up. I read that you can take use a 203k for just rehab work but is that really the best option if we have already closed?

@Jerry Padilla - We closed 2 months ago and are currently residing in the property as we rehab the top unit.  

Question: What is the best rehab financing strategy for someone with strong monthly income but minimal savings?

Context: 

I purchased a duplex that requires a substantial amount of rehab. I am a strong believer in doing everything once (i.e. know how to replace a toilet, lay floor, etc.) however the excitement of rehabbing on weekends and outside of my 50+ hr a week job is losing its appeal fast!

My wife and I have strong incomes that allow us to have $4-6k in savings each month after paying all expenses. However, we have very little currently in savings. We have been paying for repairs/jobs monthly but would like to accelerate the rehab of the second unit (roughly $30k in rehab). Therefore, have a couple ideas floating around that I would like some perspective on.

• Should we finish the rehab on unit 1, have the house reappraised to capture the forced appreciation and then take a loan out against the house (purchased the house with 3% down)
• Explore other financing options (Note: we do not have access to friends/family money)
• Continue with our current approach of budgeting repairs each month

Obviously our two main goals are to minimize interest paid and minimize the time required to rehab unit 2.

Thanks for the help!

Hi All - Looking for contractor recommendations in Salt Lake City.  Need someone to widen four entry ways from roughly 36” to 6’ in a property I just purchased.  Any suggestions would be greatly appreciated! 

Hi All - My wife and I recently relocated from Philly to SLC. While there were many factors in moving to Salt Lake (professional, personal, lifestyle, etc.), one large reason was for the "underratedness" we see in the city and the opportunity for entering into REI. We have worked over the past 3 years to become debt free (student loans) and are now to excited and ready jump into the game.

Being new to the area, we do not have many leads on REA who work primarily with investors. I’ve read the books, listened to the podcasts, watched the webinars, but we are now in a financial position and a stage of life to (in the words of Nike) “Just do it.” Therefore, any recommendations on agents that investors in the area have worked with would be greatly appreciated.

My goal is to cast a wide net on identifying agents who investors have worked with and then slim the list down through interviews/research. So, any recommendations would be very welcome!

FYI: Areas I am investigating are between Sandy and downtown SLC and then east of 15.

In 1 year I will have the opportunity to move to either the greater Denver area or greater Seattle area.  Specifically, I need to be within 90 minutes of DEN or SEA(airports) as I travel for my job.  Both areas have pluses and minuses in my book and I would enjoy living in both areas.

My question for the community is for a brand new investor, which area has the most potential opportunities for BRRR or flipping? Again, while I need to live within 90 mins of the airport, I am fine with traveling to my "farm area".

I am leaning towards Denver as Seattle seems extremely expensive for a young professional trying to get into REI. However, my concern about Denver/CO is the market seems saturated from everything I am reading.

Thanks!

Edit: While it would be great to make $50k-$100k on deals, I would like to start out with cheaper homes (lower risk and lower reward) at least while I am learning the industry

Hello All - Even though I have been listening to BP podcasts and floating around on the site for a little bit, this is my first post.  Please let me know if there is a better place to post questions like this.

Background: My mother-in-law recently approached me about buying a property that her mother currently lives in(she is about 6 months away from moving into a nursing home).  The home is an 1856 farmhouse on a large piece of land in central PA (5br 2 ba).  The house has not been appraised for >50 years but a rough estimate would be $350,000.  The house also has 6 stables and a training pen.  The home does not have any structural issues and has been relatively well maintained.  However, it is need of some modernization(kitchen is 30 years old, plumbing and electric need updated, paint, etc). 

Proposal: We have not settled on a price for the house yet but they have made it clear that they want to get rid of the house(they are very well off and do not need the cash). Therefore, I think I will be able to get the home for <$100k and will not be forced to go through a bank. Based on the high home value and low purchase cost, I think this may be a prime opportunity to do a BRRRR. I have no intention of living in this home for the next minimum 20 years. While cash flow would be nice, I am happy with just paying off the mortgage/building equity.

Questions:

I realize this is a fairly vague post from a specifics standpoint, but I am trying to do an initial assessment if I should take the opportunity.  

• The location of the home is in a small rural town about 10 mins from a city of 30k.  However, I have some concerns about finding a renter who can justify such a large home?  I have considered using it as an Airbnb as it is near mountains, fishing, hunting, etc.  Also, I would consider splitting the home into apartments but would prefer not to alter the exterior of the home, which may make it difficult to split up.
• Are there any positives to go through a bank opposed to just paying my m-i-l directly?  I currently rent my residence but plan to move to Ft. Collins in 1.5 years, where I want to buy 1-2 rental properties a year.  Without going through a bank, it will be difficult to pay for the renovation costs quickly.
• Do you agree that based on the low purchase price and high home valuation that this is a prime BRRRR opportunity? I want to get my cash out of the home ASAP after rehabing
• Would you take this deal?

Any advice would be greatly appreciated!