All Forum Posts by: Herbert Lewis

I sold my first actual fix and flip in 3 days to a private acquisition company. I have sold many of my properties before, but they were rentals. This was the first house I purchased with the intent to sell. I bought the property for $80K and put $47K into it, which includes all labor, materials, and payments. I purchased with HM from the same guy I have been using for years. It took 3.5 months to complete the house once I got access inside. During the first two months of owning the house, I had to have my lawyer go to court because the person living in the house refused to get out. This was also one of the reasons I could get a good deal on the property because I purchased sight unseen. I knew the area and what the comps were for the area, and the result was a nice profit!

Purchase- $80,000

Rehab- $47,000 (Labor, Materials, and HC)

Sold- $191,000

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $43,000
Cash invested: $50,000
Sale price: $180,000

I decided to sell one of my rental properties while the market was hot. I originally purchased this property with the attention to keep it as a long-term buy and hold. I made good money with it as a rental when I could get the tenants to pay. The last tenant I had an issue with, so I decided it was time to sell and reinvest the money.

What made you interested in investing in this type of deal?

I have mentor in the Baltimore region that has inspired me to be a buy-and-hold investor. Since then, my mentor has become a close advisor and private money lender in all my deals. Plus, in my opinion, wealth is built with buy and hold that cash flows!

How did you find this deal and how did you negotiate it?

I found this deal with a wholesaler purchasing tax lien properties at the time.

How did you finance this deal?

I originally purchased with hard money and then REFI out of the HM for conventional financing.

How did you add value to the deal?

I upgraded all appliances, countertops, and new paint, and refinished the originally hard wood floors.

What was the outcome?

The house turned out nice and made me a high profit. Plus, along the way, I made some money renting it out.

Lessons learned? Challenges?

Baltimore City is a tenant-friendly city. This was one of my first buy-and-hold properties. The lesson I learned was to better screen potential tenants and what the city rules are towards landlords.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I am my agent. Although I don't live and Maryland anymore, I still invest there and still have properties I manage from afar. The key is having systems and a solid team to help you resolve issues.

@Kiran K. I agree with @John Underwood

I would take over the management piece. I had a property manager for one of my rentals this year, and it was the poorest run property in terms of profit. The others I self-managed because they were section 8 and easier to manage. You will learn more doing it yourself, even if you can only do it for a little while.

@Simone Johnson

Congratulations Simone! The house looks amazing. I am looking forward to see where go next with your REI start. 😊

@Roger Briggs

Yes, I will be consulting an attorney once I close on the property next month.

Yes, I waived my last two inspections on the houses I purchased. If you are comfortable with the numbers and the deal makes sense. Waving the inspection in this market puts you at a competitive edge verse some who have contingencies.

@Nathan G.

Thanks, Nathan, for the insight. I have anticipated that the house may be destroyed inside. One positive is there are signs that they are taking care of the property. They seem to be keeping up the yard outside—the reward of getting this property at a great deal out ways the risk. I will see what the lawyer says on Monday and go from there.

@Ron Brady 

Thank you for this insight. I have decided to contact a lawyer for this situation. The bank's agent told me he had not even seen the property's inside, so that he couldn't give me any details. I decided to move forward because this property is in a great neighborhood and 60% to the ARV. Just doing my research, it looks like one of the original owners died, and their relatives are living there. I also called the county, and they are doing evictions again. I assume more investors will be running into the same situation as things progress the remainder of this year and next.

@Bob Reinhard

What type of eviction?

Unlawful Detainer?

Hello BP,
I am looking at purchasing a property that was foreclosed on five months ago. The property has been listed on the MLS as currently occupied. When I questioned the seller's agent, he said the owners never left after the bank foreclosed on them. What is the best course of action to take in this situation?