All Forum Posts by: Josh Legg

Thank you! @Denise Mayo-Walley

Here's a few of the floor:

@Denise Mayo-Walley see above!  

@Diane G. the terms of the cash-out refinance allowed us to pull out 75% of the home's value. In this case, our 16k investment actually caused the appraised value to increase due to the area's comps and meant that 75% of the homes value left us with a check for 30k at closing -- essentially paying us back for our investment and giving us more money to invest in the next property while still maintaining positive cash flow on the rental income. It's all about a low purchase price in the right neighborhood.  Hope this helps!

Thanks @Michael S.!

Today we re-financed our second property within 6 months of investing in our first real estate deal! Here's a whirlwind summary of first foray into the BRRRR strategy:

We found a distressed foreclosure on MLS in a popular part of town that had some distressed properties around it. It seemed risky, but we went for it because we were sick of seeing potential deals slip away to those who were bold enough to take the risk! Our offer was accepted and we went under contract.

Meanwhile, I had been stalking an additional property in a different part of town.  I liked it because it had a new metal roof and it was cheap!  We went and saw it with our realtor and decided to jump in.  Our offer was accepted and now we had two houses under contract within 2 weeks of each other!  Kind of crazy, right?

We personally renovated the first house in our spare time (nights and weekends) and quickly discovered that part-time renovation was not sustainable with full time jobs.  We hired some help to finish the first one and got them to take on the second property after that.  

Our bank gave us a great loan that required no money down at closing and included a renovation budget of up to 80% of estimated LTV. We used what would have been our downpayment as the remaining renovation budget. The note's terms were 3 years and they would renew for another 3 if we wished. It came with interest only payment options during that time -- which ended up being awesome during the start up phase! We had no student loans or car payments, so our cost to carry was essentially what most people would be paying for either or both of those loans.

6 months later, our properties are renovated, rented, refinanced and we're ready to repeat!  Our initial investment was 16k on both properties out of pocket. We were able to pull out 30k on the first property and 12k on the second property during the refinance meaning we made 14k in addition to recouping our original investment! Both properties now cash flow more than $200/mo after accounting for vacancy and repair.  We're now looking for distressed commercial properties in hopes to accelerate the path to financial freedom!

Thanks, Bigger Pockets for all the information and support!  Just wanted to pay it forward!