All Forum Posts by: Chris Shelton

Hello all, I am looking for a little advice on obtaining financing on my first deal. I belong to a CU who offers a 30 year fixed at around 4.25%. On my application it asks if this is for a primary residence, a secondary residence, or investment. I marked it for investment. Long story short I got a call and was told I was approved, but the loan was being handled by another CU who does all the Fannie May investement loans. I was also told that even with an excellent credit rating interest rates are higher because it was an investment loan at around 4.85%. 

Am I going about this right, is the difference because I am going through a CU instead of a bank?

I am also a bit concerned that after this first deal I may not be able to pull off a second deal until I can refinance this one or do a HELOC with my primary home.

I am in an area that most single family 3 br, 1 ba are averaging $100k+ which puts 20% down at $20k. I have about 30k to start this voyage and I don't want to get thrown off course after the first deal. I am wanting to try and snag 3-5 deals this year.

I have been reading, podcasting, and webinaring, but I would like to hear some thoughts from others that started this way.

I was a day late, just spoke to the listing agent and this one is already under contract. So, now I will move on to find the next one and make sure I include the tips and recommendations above.

Thank you for the input and suggestions!

I am going to walk the property today with the listing agent. From the pictures I have seen, it appears livable. I have walked the outside of the property and it does not appear to be to distressed. I will know more this afternoon.

Actually I think my total pullout from refinance would be:

95,000 x .70 = 66,500 - 45,000 = 21,500

Hello all, I am currently looking for my first deal, and I have come upon the following. I was hoping you guys could give me some insight into my analysis.

The Purchase

Single family house, 1650 sqft, .94 acre lot. Bank owned foreclosure.

Asking $55,000, $10,000 Down payment, $3000 closing, $600 inspection

Rehab = estimated at $10,000

Total purchase out of pocket $13,600 + $10,000 rehab = $23600

$45,000 mortgage/$250 mo 30 year fixed at 4.25%

Total Cost = $68,000

My projected ARV is about $95,000

I am in it for 71% of my projected ARV

If my calculations are correct, I should be able to refinance and pull out $27,000 in capitol if I hit my target ARV, correct?

Rental

Anticipated rent = $1000 mo.

Mortgage = $250 mo

Tax= $50 mo

Insurance = $100 mo

Vacancy 5% = $50 mo

Repair & Cap Ex = $150 mo.

No other anticipated expense

Total monthly expense is $600

Should cash flow at $400 mo./$4800 yr. after expenses

My annual return percent is right at 20%

Again, this is my first one, I designed a tool in Excel and checked it against the BP tools, but am I doing this the right/smart way?

Also, since this is a bank owned foreclosure, will they typically have any negotiating room below the asking price?

Thank you for any thought or suggestions you all may be able to provide. 

Everyone,

Thank you for the warm welcome! I look forward to future conversations, and I am sure I will be able to use all the help and knowledge I can get. I am appreciative to have such a wonderful site to springboard this new adventure from!

Hello all,

My name is Chris Shelton, I am in the Cleveland, Tennessee area, which is about 20 miles NE of Chattanooga and 50 miles SW of Knoxville.

My wife and I have recently decided to start learning and exploring the world of REI, specifically for passive and capital cash flow. I have been working on putting together my 5 year plan, and though it is aggressive, I would like to leave my day job within 3 years or less. The day job I reference places me in the construction and heavy industrial world as the corporate safety manager for a mid sized company. I have been in this field for a little over 15 years at the time of this post.

My wife and I are both in our 40's and have decided we cannot wait any longer to build long term wealth, thus we are turning to REI in order to pursue our financial freedom and live the type of life we want, on our terms.

We are currently educating ourselves thanks to the vast resources offered here at BiggerPockets and hope to jump into this world with our first rental or flip within the next few months. The current business plan I am developing follows the path of one found on a BP podcast, describing a the 3 year plan by acquiring 5, 10, & 15 units over that timeline. 

I look forward to the education I can obtain here and learning from the BP members and contributors. I hope to reach a point that I can contribute to others that find themselves in a similar place in the coming years.