All Forum Posts by: Philip K.

@jay sassau

Just curious why you did a 20 year amortization instead of 30? This should be able to qualify for residential if it's 4 units and a 30 year amortization would improve cash flow. 

@James Park 

Why are you just focusing on large cap stocks?  Over the long run mid and small cap stocks should have higher returns than large cap.  And I agree that you can use historical data to make it say what you want. It certainly isn't an exact science and I wouldn't necessarily follow a rule stating secular bull and bear markets last 18 years. Every market cycle can be different 

Wow that sounds like an nice deal.  Did you have a lot of built up equity in the duplex?  Just wondering how you financed the $200k from the lender if you had less than $8k in the bank.  I'm assuming they were requiring 25% down?  I haven't thought about owner financing too much but will definitely look into it.  

@David Catlin  

Welcome to BP!

I am also new to the site and originally from Champaign!  I currently have a triplex in Bloomington and there are always good properties up for grabs in central IL!

Larry

Thanks for the input.  Have you had good experiences with hard money or private lending?

Curt

Thanks for the advice.  I will take a look at hard money lenders.  

Hello all,

I am looking for advice and feedback for the best way to get to my second property.

Current situation:

My business partner and I purchased a triplex in the Spring of 2012.  Purchase price was $84,000 and we put 25% down with a 4.5% fixed rate for 20 years (Purchased from a couple before it was on the market and got a very good deal on price as they had paid $115,000 for it).  The building is just under 3,000 sq ft and it contains 2 one-bedroom units and 1 two-bedroom unit.  There is also a small laundry room.  We have made various improvements to the units and our gross monthly rent is currently $1,885 which puts our cash flow around $800 per month.

We save all of our cash flow and keep it in a small business checking account.  The problem is even though we now have good cash flow we have spent around $8,000 renovating units which is great but now we only have around $8,000 in the bank.  Our plan all along was to save up the cash flow to use for our next down payment but at the current rate it could be another 2 years.  

We have contemplated trying to refinance the property but we realize we may not get terms that are as favorable as we have right now and that would hurt our current cash flow.  

A third option would be for each of us to throw more money into the pot. (our least favorite option and we don't have a lot of cash right now)

It was great that we were able to purchase our first property and it is going well but we really want to accumulate more properties and after you spend most of your cash to get the first one it is proving difficult to get a second one.  I feel that once you get to 3 or 4 properties it will start to snowball but the process has been slow so far.  Any feedback is greatly appreciated!

Thanks!