All Forum Posts by: Jamie Rost

@Henry Lazerow I have two full sleeves and do sense that some people do have issues. In some cases when I am doing business will wear long sleeves and “dress the part for business”. What I have found is most people generally don’t mind as long as you act professional. I think the reality is that I care about what other may think opposed to what others actually think.

Thank you all so much for the feedback and advice. Lots of great information. 

If you had $90K to invest using funds from a Self Directed IRA how would you use it?

I have been thinking about this for some time. Here are some of my ideas and I would love to hear what you would do.

Option 1: Purchase a SFH/Duplex/Triplex in the Midwest all cash and hold as rental

Option 2: Use the money as down payment and purchase a single multifamily with a nonrecourse loan (this research has not been very successful).

Option 3: Use the money as a lender to fund other deals. 

I feel like I have been thinking too long about this and found myself in an endless researach loop with no end in sight. I think a fresh perspective would be great. 

I am looking at using my self directed IRA to partner on a flip with a friend. I want to make sure we clearly set up the expectations for the deal and the joint venture agreement seemed to be the right mechanism. Does anyone have any recommendations what should be included in such an agreement and the format for such an agreement.

I have been building my initial investment to implement the BRRRR strategy. In my mind it seems I would need about $100k to start for the acquisition and rehab. I recognize that the funds required to start will vary by market but I wanted to see what others have done or would recommend to get started. At my current savings rate it will take some time to get started. The questions I have are:

How much did you initially save to start? 
What are other things you have done to get involved in investing while you are building the initial investment for BRRRR?

@Chris Mason , @Kevin Romines, and @Melvin List Thank you for the great information it is very helpful. 

I have been using the BP tools to analyze potential opportunities but they do not have the same level of detail. What is a good way to quickly assess an opportunity looking at these terms? Would I do the assessment under the initial interest rate for the total term I am looking at say 20 years because anything after the initial period is unknown or is there another way I should look at this?

I have spoken with a few different banks, credit unions and private lenders and it seems like there is not a typical type structure. I am a new investor and trying to determine how much I need to realistically save to get started. For example I was looking at multi family properties and it would seem that a minimum going a bank route is 25% down with a 20 year term with a 5 arm and 10 year ballooon with the option to extend another 10. That just seems to me that that is atypical. In all of my learning and calculations to date I have been looking at 20% down and 30 year terms. 

So i guess my question is for these small multi family properties is what type of loan structure should I expect and plan for? 

@Bjorn Ahlblad Thank you for the feedback! I really appreciate it. 

Hoping to get some advice on a potential deal. 

A little background 

I am just starting out 

I have some money to invest but not enough to fund the entire deal but could likely fund rehab and afford holding costs. 

From what I know unless I am missing something this does not appear to be a great deal for Flip, BRRR, or wholesale but I think there is some opportunity I may not be aware of.

Backstory

A neighbor in my mother-in-laws neighborhood fell into hard times and will be letting the home go into foreclosure. I spoke with him and he would rather not let it go into foreclosure but does really not have any options. 

Home Condition

I was able to tour the home and observed the following

• Outside needs paint
• Garage door needs paint or replacement
• Electrical panel needs to be updated 
• Landscaping is Meh but lawn is manicured 
• Roof needs replaced
• Interior needs full paint
• Bathrooms do not need to be updated
• HVAC is 2 years old with warranty 
• Does not appear to have any leaks based on ceiling
• Many different floor types from room to room 
• Windows are old but do not appear to be leaking 
• observed one small area of roof rot by the fascia by the porch 
• Front door needs replaced
• Popcorn ceiling 
• Some drywall repair
• Kitchen cabinets painted (not very well) 
• Countertops Formica in good condition
• Appliances need to be replaced 

Numbers

• Home is a 3/2 1500sq feet on 1/4 acre built in the 60s I would guess 
• Comps in the neighborhood are high $180s but our market is declining somewhat ( I would imagine ARV at the time of completion may be $165k due to size and the neighborhood would be a solid C maybe low B
• Owner currently owes the bank $124k
• I am estimating rehab costs to range from $30k-$40k (if I do some of the work myself it would be closer to $30k I think

Strategies 

• Flip - I think the margins are too low even at the high end of current sales at 180k
• BRR - I don’t think I can get my money back out if I refinance at 70%
• Buy and Hold -  I think current market rents would be $1375-1450 cash flow about $250 if I don’t go full rehab and just go rent ready and self manage

I am thinking that it is not a great deal with any of the common strategies listed above but it seems at that price there may be something I am not thinking of . I really just wanted to verify before I pass to make sure I am not missing anything.

Thank you for any advice you can offer

Jamie R (Florida) 

I am having a very difficult time finding an investor friendly real estate agent in South Bend Indiana.  I have spoken to several agents who simply aren't looking to work with someone from out of state. I am looking to acquire a quadplex and single-family home by the end of the year in this market. Does anyone have any recommendations?