All Forum Posts by: Jason DeMauro

I am about to close on my first 2 duplexes this month. In my analysis I budget for vacancy and capital expenses (which I believe most of you are doing) and it comes to about $10k annually for each property.

My question is, what are you doing with those funds in the absence of a vacancy or capital expense?

It feels like a waste to allow the funds to be sitting in savings account with near-zero interest. My thoughts are that these could be placed in some semi-liquid investment vehical and drawn down when need. If the capex funds are needed immediately, I could always float the downpayment on the job with a credit card.

If you are doing something other than letting it sit in a savings account, what are you doing with the funds? What challenges/successes have you had?

@Brandon Rush

Thanks for the response. I was thinking if they used a management app like Buildium there may be a history. But I see your point.

I am purchasing my first multifamily property, small two-family with one unit currently occupied. The tenant has been in the home for 3 years and wishes to stay.  At this time, I have no intention of requesting the unit be vacated at sale. 

For due diligence sake, I am requesting current lease agreement, transfer of security deposit, history of payments and maintenance requests. 

Is there anything else that I should be asking for? Or, language that I should consider placing in the contract?

I found a property that I am interest as a BRRRR. The property is listed as a HUD home, 2 family. Does this place any limitations on what I can do with the property?

@Michael Patrick

There is a tree that sits near the property line I'd like to remove. Needed to know who owned it.. Also, as a result of the survey I learned there was a slight easement on the driveway with the neighbor.

@Hai Loc

Thanks. I think it worked out to about 28% . That stood out to me as well. These fees were the legal retainer, title, survey and other fixed fees.

I just closed my first deal today.  It is a flip in Syracuse NY. The property was listed for $9900, I submitted my offer with an escalator clause. 

Here's the numbers:
4 Bedrooms, 1.5 bath, 1344 sqft.

Purchase Price - $13000

Closing Costs - $3749

Estimated Rehab - $25,000 - 6 week timeline

Holding Costs - $500 month

Taxes - $1744 annually

ARV - $95000

Great, thanks again Steven. I will check them out. 

Steve, So if I am understanding you correctly the quick HML wrap all the risk into higher interest rates, while those that appraise and effectively try to manage risk are cheaper, but slower. Makes sense.

Have you used HML? What was your experience? I would take any recommendations, I am still in the fact finding phase of this.

I am currently under contract with my first flip. The project is a 4 bed 1.5 bath single family with a detached garage. I'll pay $13K for the house, anticipated rehab is $25k, hoping to be all-in under $40K.  Comps in the area are selling quickly for 90K-110K. I have all my contractors lined up, just waiting on a closing date to schedule. Given the location, the exterior work is going to be difficult to do in the winter, but I have a 6 week construction schedule.

With the majority of this project in place (barring any significant rehab issues), I am beginning to look into what my next deal is going to be.  Ideally I would walk into my next project once this one hits the market. However, since the majority of my cash will be tied up in this first flip, I don't have the financing worked out. 

I have been skimming some options and am leaning towards hard money. My thought is that I can get into the 2nd project and pay off the loan with the proceeds of the first flip.

 What has your experience been with hard money lenders? Any recommendations for lenders that were easy to work with? What pitfalls should I be aware of that I may not? 

-Thanks