All Forum Posts by: Jim McCabe

@Renata Siman we did 95% of the work ourselves. Only hired in contractors for a couple bigger projects. We took possession of the house on Feb 15 and officially closed July 31. The rehab itself took approximately 3 months. We got an offer and accepted in just over 2 weeks of listing it. We listed May 10 and accepted an offer May 28. We ran into some red tape with FHA loan stuff which pushed the initial offer closing of July 7th to July 31.

@Edgar Martin It feels fantastic to get the first one done!  For closing cost, we did 6% for realtors (3 to seller and 3 to buyer) roughly $7500.  Then gave $2000 or $2500 ( i can't recall exactly right now) to buyers to assist in closing in their closing cost.  The remaining fees are all the normal items i believe you run into with a title company.

@Manuel Angeles forgot, we did end up going over budget about 5k.  We were pretty lucky to hit timing just right.  When we bought the house we thought we might be about to get 110 to 1150 tops out of the house. 

@Maggie H. we took possession on Feb 15 and listed May 10.  Just about 3 months. 

@Manuel Angeles It had it's ups and downs for sure. Honestly, the reno part wasn't bad. My wife and I did all of the work with the exception of two things. We paid a plumber to tie into the existing plumbing to add a 1/2 bath. Then we paid a contractor to put up some paneling in the basement. As for how it went after after we accepted an offer, it was a learning experience. First, I swapped the deed from my name to my LLC about a month after we closed. Well that caused some issues as the buyer was using an FHA loan. Which the regulations say that the house must be owned for 90 days before proceeding. That pushed our closing back an extra month. Then during the inspection the buyers requested some things done. We conceded and did those thing. Then the real kick in gut was the two FHA appraisals. The first one was fine, didn't request for anything to be done. The second appraisal required a list of items to be done, add hand rails to front and back steps (a common request), some other minor stuff but the kicker was he required me to remove some rotten wood from the shed in the back and paint the entire thing. Honestly i don't think i looked at the shed or went in it but one or two times. That bit was very frustrating as in his appraisal he didn't even give the shed any value what so ever. And it's not like the home inspection where you can negotiate, the loan provider requires the list of items to be done. At the end of the day it wasn't really all that bad, but at the time it was pretty frustrating. Now I know what to expect in the future.

Yes in Indianapolis, well technically Beech Grove which is a sub neighborhood engulfed in Indianapolis

Thanks guys!

@Steve Vaughan Yes this would have made a pretty good rental and brrrr candidate.  However I could not convince my partner (aka my wife) to go down this route.  I think eventually she will come around to this thinking.  It's a great method, the tax benefits alone are amazing.  However, my wife has been a bit slow to come around.  Just need to get a few flips under our belts and I think she will come around.  Especially when we pay our tax bill next year!

@Alex Olmo looked at one this morning.  Having my contractor go by tomorrow.  If he thinks its reasonable and no major surprises, going to pull the trigger to get that one going.  

@John Curd I found the deal on the MLS with my realtor. In fact, i made a lower offer, the said no, didn't even counter. Made another offer and they said they accepted a full price offer. I was bummed. Kept looking and sure enough a month later it came up back on the market, the other deal fell through. Brought my price up a bit and they accepted. It was all about persistence I think.

I funded it several methods.  I got a conventional mortgage to buy the house.  Then used money from my solo 401k  to use as money down and rehab.  Additionally I used a loan from prosper.com to have extra funds to get the rehab done.  

These are obviously rounded, but here you go

Bought the house for 58k

Rehab 30k

Closing cost 11k

Sold the house for 126k