All Forum Posts by: Cyrus Sidhwa

Absolutely Awesome!!! Great to hear this stuff really works - thanks for sharing!

Thanks for the great info everyone. Working "backwards" from ARV and minimum acceptable profit makes perfect sense. @Account Closed, I have to agree and am very glad to see your comment about anything less than 10% being dicey. As a newbie, I've done my share of lurking on here and have been surprised to see many people seriously considering deals where that concept is not followed. It never made sense to me to go after a deal where the margins are that tight - seems like high risk / low reward... nice to get some reaffirmation. Happy New Year everyone - let's make 2014 the best yet!

Congratulations @Josh Dorkin , @Brandon Turner and everyone who works behind the scenes on the site. What an amazing resource you have all created!

The standard formula for max purchase price is 70% of ARV minus Repairs. However, this doesn't seem to account for closing costs or holding costs which can easily reach tens of thousands of dollars when using a HML. My initial thought is to make the formula: 70% of ARV minus (Repairs + Holding Costs + Closing Costs When Buying + Closing Costs When Selling). However, I imagine deals that meet that criteria are extremely rare.

I am wondering if the following makes sense, or if there are flaws and/or things I'm missing / not accounting for. Here's my formula: ARV minus (Minimum Acceptable Profit + Repairs + Holding Costs + Closing Costs When Buying + Closing Costs When Selling). Does anyone use anything like this?

I would appreciate any experienced flippers explaining how you build the additional costs into your max purchase price formula. Thank you!

Good luck Zoran! Keep us posted.

Thanks for the info everyone!

Let's say an investor buys a property with a HML, fixes it up, and flips it 3 months after the purchase. Does the investor pay a portion of the property taxes? Would you have to pay those taxes when you close on your sale to the end buyer? Please note, not looking for info on the income taxes, strictly the property taxes.

Thanks for the help with such a total neewb question - I tell ya, it's humbling to have to ask some of these things....

Thanks guys!

I am researching various HML's and learning that most will only pay on the repairs after they have been completed. This makes sense for any work that is being done by a contractor, but what if you are planning to do the work yourself? Are there any ways to at least get the materials paid for up front?

Also, will HML's typically require that you specifically use a licensed contractor, or can you use a handyman? I used several handymen on my only previous rehab project and I had to, of course, provide the money for the materials up front. Do licensed contractors work differently - in other words, will they cover the cost of the materials until the job is done?

Basically, trying to understand how to make make a hard money loan work work if you can't get the money until after the work is done. Please advise.

Thanks BP!!

Thanks - done!