All Forum Posts by: Chris Ross

Hi Nida, Mid South Home Buyers is legit. I’ve purchased a property from them and visited their facility in Memphis.  They have great people, communicate well, and seem to do a good job on rehabs.  So far I’m happy with them.  There is a bit of a premium when buying turnkey homes but I would buy from them again in the future.  Although I will likely try finding a better price using a local realtor for my next property once I’m ready.  I’ve never heard of mid south turnkey though.  Good luck. 

I just closed on my first property with mid south. I also took a trip to Memphis to meet them.   So far everything has gone smoothly and they have a solid operation and stand by their work.   Nice people to work with.   I am just under the 1% rule but happy with the purchase.  I would definitely buy more from them but the waiting list is frustrating and it’s hard to buy in specific areas from them as it’s based on what they have available when you hit the top of the waiting list.   I’m planning to buy more with them but also exploring other options with a local realtor so I have more choice on properties and locations.  My only other concern is the areas that mid south buys in are typically C areas or less for the majority of properties. They have a great track record and seem to do well there but I may want to try a B class at some point.   Best of luck.  I don’t think you will go wrong with mid south. 

Quote from @Stephen Akindona:

Hey @Chris Ross I am curious as to why you would buy a turnkey property with cash to refinance it later? Did you buy a turnkey property under market value? It is likely that at the very least you paid market value, you may have actually paid a premium. If you do a refinance it doesn't matter if you do a rate and term or cash out, you will only get a 75% LTV. If you purchased with no equity then you are actually going to end up putting down more money than if you would have just purchased with conventional financing up front. Most investors are trying to stretch capital to buy more properties. Unless I am missing something you would have been in a better position just buying with 20% down on a conventional loan. Hit me up to chat more about it if that doesn't make sense! Happy investing

 Hey Stephen, appreciate the note.  I do agree with you about using leverage and other people’s money to acquire properties, especially turnkey since it is priced at premium.   A few of the reasons I’m planning to do this are. 1.  The turnkey provider has a waitlist and cash deals gets me higher on the list.  2.  They charge a reduced property mgmt fee for cash buyers. 3.  My thoughts are to pay cash and take out 75% of the equity to buy another property later this year when rates go down and perhaps by then I get a little appreciation and get a higher cash out from the refi.   I am open to suggestions on this as I realize this may not be the typical approach.   I figured this approach isn’t that different than financing with 25% down but I get the benefit of a lower interest rate and reduced prop mgmt cost.  I realize that there is risk in doing it this way though.  Open to your feedback and happy to chat with you.  Chris 

Quote from @AJ Singh:

@Chris Ross

Please do an inspection of the turnkey property via an independent inspector as soon as you open escrow. That should be part of your due diligence. Please pay special attention to plumbing and electrical.

Enough threads on BP on pros and cons of turnkey buying.

Thanks AJ, appreciate the advice.  I did get an inspection and there is a plumbing issue that the city needs to take care of.  Glad I did the inspection before closing. A good inspection is great advice.  I guess turnkey isn’t always fully turnkey as advertised.   Although to me plumbing and electrical are the most critical components of turnkey so it’s a bit concerning this came up on inspection for a turnkey property. The company seems to be all over it so hopefully this gets repaired but we will see. Thanks for the advice. 

Quote from @Jordan Ray:

Quote from @Chris Ross:

Hello, I'm going to be closing on my first SFR investment property soon via an all cash deal. After closing I'd like to do a delayed finance to use the cash for a second property. The property is in Memphis TN. I am open to any lender recommendations from those that have done the same. My thoughts are to wait until the May timeframe since I believe rates will drop a bit by then and I'll still be within the 6 month threshold for a delayed finance transaction. Is there a difference between a delayed finance or a cash out refi? They are ultimately the same thing but I know that many lenders require seasoning. Would I be better off waiting until the 6 month mark or later to do the refi? Is there a difference in rates or process? I don't have my second property picked out yet but will work with a turnkey provider once I have the funds. Any recommendations are appreciated. Thanks

Have you looked into just doing a "rate & term" refinance until you can pull cash out after the 6 month seasoning?

 Thanks Jordan, that is a good idea.  I will look into a rate and term refinance.   I am paying cash for the the turnkey home and am trying to figure out the best time to pull out cash to buy a second property.  My thoughts are to wait until the next interest rate drop.   But I’ll look into rate and term. Thanks 

Quote from @Jay Hurst:

Quote from @Chris Ross:

Hello, I'm going to be closing on my first SFR investment property soon via an all cash deal. After closing I'd like to do a delayed finance to use the cash for a second property. The property is in Memphis TN. I am open to any lender recommendations from those that have done the same. My thoughts are to wait until the May timeframe since I believe rates will drop a bit by then and I'll still be within the 6 month threshold for a delayed finance transaction. Is there a difference between a delayed finance or a cash out refi? They are ultimately the same thing but I know that many lenders require seasoning. Would I be better off waiting until the 6 month mark or later to do the refi? Is there a difference in rates or process? I don't have my second property picked out yet but will work with a turnkey provider once I have the funds. Any recommendations are appreciated. Thanks

 For a conventional loan difference between closing within 6 months and after is the amount you can borrow. If you close within 6 months the most (assuming single family) is the LESSOR of 75% or what you paid for the property plus closing costs. 

if you have NO financing on the property AND you have waited to close after 6 months you can use the new value and borrow up to 75%. 

The rate and terms are no different on either option.  

Thanks for the clarification and reply Jay. This would be a single family residence with no financing so sounds like either option would work for me.  This is a turnkey property so it had a full rehab and that is priced into the purchase price already.   Based on that, the determining factors would be how much the appraisal would be right after close vs waiting 6 months and whether the interest rates would drop.  I’ll probably base the timing on interest rates.  I would assume lower interest rates would drive the appraisal higher but I realize that is not a given.  Thanks Again.  

Hello, I'm going to be closing on my first SFR investment property soon via an all cash deal. After closing I'd like to do a delayed finance to use the cash for a second property. The property is in Memphis TN. I am open to any lender recommendations from those that have done the same. My thoughts are to wait until the May timeframe since I believe rates will drop a bit by then and I'll still be within the 6 month threshold for a delayed finance transaction. Is there a difference between a delayed finance or a cash out refi? They are ultimately the same thing but I know that many lenders require seasoning. Would I be better off waiting until the 6 month mark or later to do the refi? Is there a difference in rates or process? I don't have my second property picked out yet but will work with a turnkey provider once I have the funds. Any recommendations are appreciated. Thanks

Hello,

First post but frequent visitor to these forums.   With all of the TK companies out there now I’m curious if anyone has any recommendations based on what I’m looking for.  I’m in a good position to invest now although I’m not sure it’s the best time given the interest rates. 

1.  TK, preferably new construction in sunbelt region or OH

2.  Looking for a very good school district 

3.  Positive experience with TK PM 

4. Positive CoC day 1. I understand the more passive, the less positive cash flow but for a first investment property this would be my preference.

I've looked into R2R, Roofstock, Doorvest, REI nation. But most properties are not new construction and from what I can tell not favorable neighborhoods or schools. Doorvest seems attractive to me given how passive it is but I'm skeptical of their property management.

If anyone has recommendations based on positive or negative experiences, I’d appreciate it. 

Thanks