All Forum Posts by: James Camp

Hi @James Camp, I found the MLS listing for this property on Realtor.com, and looked up the address in PropStream. I'm showing the last arms-length sale for this property was on 23 Dec 2019 (recorded on 1/15/2020), for $268,000. And now it's listed on the MLS for $68,500? I'm confused why the property is on the market at such a seemingly steep discount.

Its current owner is listed as Growth Developments LLC, which appears to be a "We Buy Homes" business.  It's probably safe to assume the seller is an investor, meaning they likely know what they're doing.  What did they find out in this 6-week timespan (12/23/2019 up to today's date of 2/7/2020) which motivates them to take a $200,000 loss?  I see the neighborhood is, let's say, less than great. But the LLC is based in-town, not out-of-state, so they must have known what part of town they were buying in.

I'd suggest getting really familiar with disclosure laws in Missouri.  Find out everything the seller is required to tell you, and what they're not required to tell you as well.

I'm currently an aspiring (i.e. not experienced) investor, so bear that in mind.  I might be totally wrong about the whole thing, and / or mis-reading the transaction history in PropStream.  Or maybe the PropStream data itself is less-than-accurate.  Either way, make sure you have a local team in place (realtor, property manager, etc.) to advise you on this property.  Seems like there could be some sharp edges here.

realized that its being sold by a wholesaler, and they bought sevearl houses in a package :)

Hi @James Camp, I found the MLS listing for this property on Realtor.com, and looked up the address in PropStream. I'm showing the last arms-length sale for this property was on 23 Dec 2019 (recorded on 1/15/2020), for $268,000. And now it's listed on the MLS for $68,500? I'm confused why the property is on the market at such a seemingly steep discount.

Its current owner is listed as Growth Developments LLC, which appears to be a "We Buy Homes" business.  It's probably safe to assume the seller is an investor, meaning they likely know what they're doing.  What did they find out in this 6-week timespan (12/23/2019 up to today's date of 2/7/2020) which motivates them to take a $200,000 loss?  I see the neighborhood is, let's say, less than great. But the LLC is based in-town, not out-of-state, so they must have known what part of town they were buying in.

I'd suggest getting really familiar with disclosure laws in Missouri.  Find out everything the seller is required to tell you, and what they're not required to tell you as well.

I'm currently an aspiring (i.e. not experienced) investor, so bear that in mind.  I might be totally wrong about the whole thing, and / or mis-reading the transaction history in PropStream.  Or maybe the PropStream data itself is less-than-accurate.  Either way, make sure you have a local team in place (realtor, property manager, etc.) to advise you on this property.  Seems like there could be some sharp edges here.

Not exactly sure, but insurance and property tax estimates may be a little low. Looks like a cool property!

On your credit card, @James Camp. Phew, you better be darn sure about your numbers and time frame. One wrong move and you could be in a world of hurt. Is this a duplex? Looks like it in the picture.

That said, regarding your numbers:

• Repairs and CapEx are a little low. I like to use 15% combined.
• What about water/sewer, lawn care, and snow removal? These are usually covered by the owner of a duplex.
• If you're tripling the value of this property, you should expect your taxes to go up at some point.

If you could do this as a BRRRR that truly cash flows $150/month, I'd say it's worth considering. Perhaps you can get it a little cheaper or reduce your reno budget a bit. Leave in a little more equity to reduce your payments.

203K is for owner occupied and the OP is looking for OOS investment. One other thing to note on 203K, if you have the money to float each of the draws, it will go much smoother with your contractor.
@James Camp An experienced person can easily get 90% of purchase and 100% of renovation from a HML. You will really want to have 15% or so of total project because of insurance, closing/origination costs. Here are a few steps to mitigate your risk.

1. Knowing your refi position is critical because if you can't you will lose the property or be stuck in a high interest loan for a long time. There are good commercial options that will approve based on the property DSCR and not your personal DTI. The fees are higher and rates are probably a little higher but that is your friend.

2. RESERVES, RESERVES, RESERVES - Estimate your renovation time, double that and have that many months of interest payments on hand, utilities and any other operating costs. If it is your first time, you should really be prepared for your renovation to be 2X what you expect. It is ideal (and will really improve your ability to successfully engage contractors) if you can float the construction draws

3. Exit plans - have multiple. If you have to flip it, what does that look like? Really do your homework on your comps/ARV and make sure your comps are not done much more nicely than your reno, or have a location or amenity your subject property will not.

You didn't ask, but here is my advice. Find a local flipper in NY and figure out how you can help them (even for free) for 2 or 3 projects. Build your $10K into $20K during that time and then do an out of state BRRRR.

What credit card company do you use for your LLC that pays you back 2% cash back? My LLC cc doesn't do anything. I need to sign up for yours! I just got a separate cc for my LLC to keep things simpler. But it's not paying me squat!