All Forum Posts by: John Giachino

Thank you, Caleb! 

No Property management fees, I manage myself. Reasonable to expect little to no CapEx in the first 5 years since that will be included with the rehab. Again, not a large amount of maintenance due to full rehab. On top of that, this would be in a high appreciation area. That cuts most of what you were saying. I truly appreciate the input.

Great question. Got the refi quote and PITI should be around $1100, but let's use $1200 for this. Rents in the area are looking around $1600-2000/month depending on the property. And after the rehab it should rent closer to the higher end of that.

I went to college there and still frequent the area. If you’re looking to invest there, you can’t go wrong with Fayetteville due to the university! Also, with Walmart and friends up in Bentonville, Rogers and Lowell are looking to be great places to see some good appreciation in the coming years. The amount of money being donated to the community by the Waltons is absolutely crazy. Tons of outdoor recreation is being built every day there. IMO, it would be a great place to invest! 

Currently working on getting some estimates for this, but I've got some rough numbers. I've been listening to every podcast I can get my hands on and everything I can read online, but just wanted some additional opinions or advice from the pros. I'm looking at a house in an up and coming neighborhood of OKC. I spoke with owner yesterday and he said there is some foundation work that needs to be done. I am having someone go out and look at this soon to get actual estimates. Other details: house will need to be completely remodeled - new everything. House is less than 1500 sq ft. and about 100 years old with some cool architecture that goes with the area. Initial price is looking at 60K (although I believe we will be coming down from that, but let's use 60K for the numbers). I am confident that the the ARV is at minimum 200K after running some comps (I am licensed agent with access to MLS, and I am having another agent run some comps as well). Again, I haven't gotten a contractor out there to the house quite yet, but with these numbers, as long as the Rehab comes in under 80K (foundation repair included), then add 10K for cost of loans and any other miscellaneous expenses, we should be coming out to a perfect BRRRR at 150K in total and 200K ARV for the refinance. These numbers are just estimates, but I am confident that these are accurate. What I'm really asking is what should I be looking for here, and what are things I should be keeping in mind. Is there anything I am not accounting for?

Thanks in advance!

Hi there. I was recently considering the 203k loan! What was frustrating for me is that it isn't exactly easy to find an article online that outlines every part of it. I ended up listening to every podcast I could find on Spotify about it. That's where all the real information came from for me. I think the one I personally liked best was "House Rich" episode 2 labeled "is the FHA 203k loan program the best loan?"

It detailed someone who is currently going through the process and he outlined everything for the loan. I would recommend that because there was too much information for me to type out here. Tons of info are on those podcasts that you just don’t easily find with some internet research (for example: you can roll the first 6 months of mortgage payments into the loan because you likely won’t be living in the property during rehab time). 

I was listening to episode 513 earlier and the first topic discussed was someone purchased a SFH to use with BRRRR method. They purchased it in an LLC. The issue they ran into was that the bank was using the income valuation approach because it was being held by an LLC when he went to refinance. Obviously it appraised differently than he was expecting (or else he wouldn't be asking the question). David offered the solution of transferring the property to be held by the person, not the LLC and then the bank would then use a market value for the refinance.

Now for my question. I purchased my first income property about a year ago. It was a fantastic decision and is cash flowing very nicely and has appreciated around 10%. Rent is currently $1700 and I purchase price $183K. Cash flow is very nice at over $650 and my total expenses for the last year on it have totaled about $1250. This property is held in my name, not currently an LLC. The question is: Could I transfer my SFH property to an LLC and then get a commercial cash out refinance based on the income approach on the property? Does it work in that direction? Or only the other way around?

First post here ever! Thanks!

This time last year in OKC, the tenant offered 6 months up front. They’ve been fantastic for a year now and just signed for the next year as well. I definitely felt what you’re feeling though. I was very weary about why they wanted to do that, but I also knew OKC was a very hot rental market at the time. Turned out to be beneficial for me as they take fantastic care of the house.