All Forum Posts by: Cody Campbell

Hey BG community,

I jumped into the REI and would like some friendly advice about my next step. I recently purchased a property that had a 3/1 house on it, as well as a 4/2 apartment. The asking price was $79,900 and after talking with the realtor and luckily the owner of the property found out why it had been on the market for so long and why he was selling. I ended up getting the property for $35,000 and paid all closing cost making the deal right at $37,800.

It is currently being remodeled and repaired with a total cost of $15,000 for rehab. The property is about 1/4 mile from a university and would be great for students. The property as a whole should bring in $1900/month (gross) 

No here is where I need the help. There is a brand new construction in the same area (actually closer to the university) its a duplex of 3/3 (2 units) Each unit should rent at 1200/month. Everything is brand new. They are asking $250,000. 

Here is my plan. Hard money lend the 50k to purchase the new construction duplex. After rehab on the other property, the ARV should be 100k and i would refinance the with 70% LTV and cash out the 70k pay back my hard money lender and have 2 properties that would gross me $3400/mo.

Thoughts?

I would look in every window and make my assessment and offer based on worse case scenario. If you think it may need to be gutted, make your offer based on that. How does it look structurally?

@Lance W.  

You Came to the right place, dive into the podcasts and forums and you'll be able to put that equity to good use. 

thabks for the input.

I'll keep you posted

I would fund the rehab the same way...hard money lender. I know several hard money lenders and the risk is low for them if they are the primary lender and they obtain the property of you don't repay the loan. The lenders I know usually do a 12% with 2-3 points on the loan. 

I haven't purchased the property yet but if the seller won't take the offer I will then offer 15-20% of the profits. 

The lender may need a clause in the loan giving them the property if you don't pay.

Tom S. Thanks so much...trying to do things with as little money down. I appreciate it. Thanks

I'm working on a deal to buy a house. Currently the house is a 3b/2b home with partial basement and detached garage and is on the market for 119k, local comps show same area and same size at around 120-130k. The house is in much needed repair. I'm going in to purchase the house at 50k with 35k in rehab costs, am I'm also offering 20% of the profit after the flip. My question is how do I write up for the seller to hold the note? Should I do 15yr with payments beginning in 90 days? 30yr? It's a hypothetical question but would truly love some feedback. Has anyone done this? Seller hold the note during the flip?

Thanks 

Newbie here: I came across a piece of property that has a 3b/1b house on it. On the same piece of property is a 4b/2b detached apartment. It's been on the market for over a year and the asking price was 79,900. I took a look and asked a bunch of questions and found out the seller wants a new place and wants to put 25k down and still owes 15k on the house. So I put in a cash offer of 40k not thinking they would take it...but they did. This is my first REI transaction. The property is only 1/2 mile from a university and would be great for students. The problem I am having is there was an addition to the house they may or may not have been permitted. The realtor is telling me it is zoned for "church" I guess a parsonage, but the seller is working on getting it zoned for residential. Also if I split the two dwelling I would need zoning for dual-dwelling. I didn't know any of this prior to the offer, but still feel it's a steal with potential monthly income of 1500-1800/month. Question Where do I find zoning and permit histories of a property?

You should always check craigslist for deals. They have a materials section that includes everything needed for rehab, AND craigslist is a great place to negotiate deals on material.