All Forum Posts by: Eric Kuo

@Sharon Williams thank you for your reply! 

@Mark Fries Thank you for your reply!

Hi to all remote investors. So after closing, do you hand the keys to the general contractor who will be handling the rehab, or how do you manage? Thank you in advance for answering!

@James Gates

Thanks so much for sharing. I am in the Seattle area and just started learning about BRRRR, but the stories around Seattle is just discouraging, and yours is the complete opposite and really helps to motivate me! thanks!

I am in the process of getting HELOC myself. One thing I have not seen people talk about is how you pay the interest back after you start taking out funds from your HELOC before your refinance ? Do you take out more than you need to cover the monthly interest payment? Or do you have other fund to cover it?

Thanks again!

Thank you @Ned Carey for your reply! 

I am looking at Redmond , WA. The rent in this area indeed seems pretty high.  $500 is just hypothetical :) I am just trying to vet my logic and math. I feel like this logic seems to be reasonable to help me have a upper bound when assessing if a property is worth pursuing.  But obviously being a newbie I might highly likely have overlooked something. :)

Thanks! 

Hi,

This is my very first post, so please excuse my ignorance. I started reading BP, BP's books, and listening to all the amazing Podcasts a few weeks back. Finally have sometime to sit down and do some homework. At this point, I am trying to figure out the price point of a property being a deal or not given a potential rent amount.

After researching the area of my interest, it appears that for a 2 bedroom, I can rent for about $2550. And here is my math logic.

Assuming per month

• Tax = -420
• CapEx = -200
• Insurance = -30
• Vacancy = -425
• Management = -100
• Matainance & Repari = -42
• Cash Flow = -500

$2550 minus all of the above is $833. This would be the max of my mortgage can be.

Given $833 mortgage payment per month, assume 30 year fix with 4.75% rate, the max I should borrow is $159,750 if I want $500 cashflow.

I used the PV function in excel. Assuming 75% LTV, the ARV will have to be at least $213,000.

Which means, the sum of my purchase price + closing + rehab + any additional cash I'd like to get (for next property) needs to be < $159,750 for the property to be a good deal, and that is also assuming I can get at least $213,000 ARV.

Is this logic reasonable? Am I missing something? Or am I way off?

Thank you!