All Forum Posts by: Scott Hawks

Your goals and story: 

I currently own a SFH that is rented out. I'm looking to expand my portfolio with 2 additional buy and hold purchases

Location of property: 

Gadsden, AL 35903 for both

Purpose of financing: 

purchase both.  the 3/1 will need some cosmetic work on the inside and a new hvac system.  the 2/1 is pretty much move in ready with a few minor cosmetic fixes.

Type of financing sought: 

looking at hard money or private, but not sure.

Current or prior ownership of real estate: 

currently own 1 SFH that is rented out and mortgage free.

Occupancy: 

investment with traditional long term leases

Value of property at present and/or your offer price: 

3/1 property looking at placing an offer of around $55k

2/1 propery looking at placing an offer of around $70k

After repair value: 

3/1 should come in around 80-85k

2/1 should come in around 90k

Anticipated or actual appraisal issues: no

Current rents per month: 

both are owner occupied.  

Fair market rents per month: 

thinking i can get $850 - $900 for both properties based on comps and rentometer data

Down payment or equity: 

love to be able to use the equity in current rental for down payment on these 2 properties

Source of down payment funds, if applicable: 

own funds if necessary, or equity in current rental

Income Source: 

Salaried/W2 in IT for over 25 years.  

Gross monthly income (optional): 

$11K

Monthly debt obligations appearing on credit report, plus (if applicable) personal rent and alimony/child support/etc: 

Debt to income ratio is 10% including mortgage

FICO: 

Excellent

Credit issues:

none

Hoping i'm on the right track here.  If not, please educate me.  I'm still a newbie and any advice is welcomed.

Thanks

If they both meet your criteria for being approved, i would rent to whomever submitted their application first. Keeps thing clean and neat from a legal standpoint.

I personally would not hire anyone that did not have general liability insurance and workers comp.  It's just a CYA for you.

While i like the convenience of an online lease, i still do paper leases (at least for now).  I sit down with the tenant(s) and go through every section with them, making sure there are no questions, and have them initial each section as we go. This ensures they understand what is required of them from the lease perspective as a tenant and helps limit the "i didn't know that was part of the lease" shenanigans. I know a few folks who actually video record their lease signings.  It has come in handy i know of at least once. Yeah, it takes time and effort, but in the event of an eviction, it should make the process smoother and more efficient.  

If there is an option when you design the form to require them to "initial" it after each section, that may encourage them to read it, but ultimately they are responsible whether they actually do that or not. 

That's just my 2 cents.  I'm sure there are other here with vastly more experience that can provide more value.

Thanks for the feedback Zach.  I'm definitely still learning the all the terms and exactly what they mean and how the affect what i'm looking to accomplish.  

Greetings BP Folks!

My name is Scott Hawks.  I live in Gadsden, AL.  I'm completely new to real estate investing.  Been wanting to get in for a while.  Acquired my first property last year.  Just got it finished up and rented out in July.  I currently work in IT full time.  My goal is to get out of corporate america in 5-7 years and do IT as a side gig with real estate my main income stream. Looking primarily at buy and hold rentals and would like to do some flipping as well to supplement my income for more buying power for the buy and holds.  Been stalking BP for a couple of years now.  Joined last week with a pro membership.  The tools here are amazing, and from what i have seen, so are the people.

Looking forward to a great journey!!

Scott

Brand spanking new to owning rental property. Just started renting out a SFH that i inherited and has no mortgage. Looking to acquire a second property by the end of the year and i have some questions and am looking for some advice/guidance on how to fund the down payment on the next property.

So, my first question is what kind of numbers should i be shooting for on monthly cash flow and CoC ROI? Best i can tell, i should expect to cash flow $100 - $150 per door? And CoC should land somewhere between 7% - 15%? (i'm using the BP Rental Property Calc to get the numbers)

I've been looking at properties around my area, and most of them are going to need a ton of work to get move in ready. Inventory in my area is very low, so i'm struggling to find properties that produce reasonable monthly cash flow and CoC (based on what i believe to be good numbers). That being said, the property my current rental sits on the lot runs through all the way to the road sitting behind it. about half an acre is empty and is big enough for a SFH or a smaller duplex (2 unit 2/2). I'm considering building given i have the property available. I know it's more expensive to build, but also would be less maintenance at least for the first 10 years or so since its a new build and i could get more rent for a newer unit(s). Just looking for some feedback on the buy/rehab vs build new.

So, i'm looking at 2 options for coming up with the down payment on the next acquisition. 
Option 1: Refi current rental and get cash out. 

Option 2: Pull some money out of an inherited IRA

My thought process here is this. I have fantastic cash flow on my existing rental. I'm kinda thinking of it as a sort of safety net cause i can bank so much of the cash flow and still pay myself about $150 month while building reserves for things like vacancies, maintenance, and cap ex. Again, just want some feedback from the community as i'm sure someone has been in this situation before.

Thanks!