All Forum Posts by: Karen Spriggs

Hi experts out there,

I've been asked this a few times at the bank when opening business accounts but have never truly found the code that matches what real estate investing should fall under.  Now I need it for a business loan.   I recently started in the "fix and flip" business and will be "buying and holding."  None of these below fit.  What code do you use for real estate investing?

Investment Info:

Single-family residence fix & flip investment.

Purchase price: $66,000
Cash invested: $28,000

The fix project was completed in just over 4 weeks but that was in the middle of the pandemic. Lots of potential buyers have looked and loved the house but have financing issues or do not care for the location (west of Charlotte; one neighbor across from street has junk in yard). House was a foreclosure and I negotiated with the bank for purchase (including allowing inspections prior to finalizing offer). Two offers; both wanted closing costs paid for. 

What made you interested in investing in this type of deal?

Found the deal for a friend living in the area. It ended up taking a life of its own as I met the investor who bought the house next door and connected well with (and their team).

How did you find this deal and how did you negotiate it?

Bank foreclosed property. Had contact/dealings with same bank for another property.

How did you finance this deal?

Whole life insurance policy (highly recommend this!) for most of the amount; credit card loan (0% interest for 1-1/2 years) and one private money lender.

How did you add value to the deal?

Restoring the house -- adding new HVAC system, resurfacing all walls, painting, replacing light fixtures, and all appliances; carpet, crown molding, etc. All new plumbing fixtures; replacing wood on deck and repainting exterior (trim). Cleaning up. It also came with vacant adjacent lot on which we will be building new construction.

What was the outcome?

Two offers...both had changes (their finances).

Lessons learned? Challenges?

Selling in the middle of a pandemic changes the game plan! Sometimes it is better to let go of what you hope to get and just go with an offer that is okay but not the best.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

In process. Likely, I will recommend.

Thank you, Nicolas!  (Stephanie, I'm not seeing your reply yet...).   That's my thought, too.  Trying to persuade the family, though.

I am looking at a potential sale of unique log home (gorgeous but needs updating -- no problem there).  However, the home has some unfortunate history with it (not going to spell that out here but previous owner died there).  Family wants to offload it.  Another issue is its location:  near Charlotte -- that's a plus, but at the back of a trailer park (not a well-taken care of one at that); one has to drive through the small trailer park to get to the home.  It is on a corner lot and has open space on two sides.  The property is nearly 2 acres with lots of trees and yard maintenance.   Another realtor pointed out that, although it is a beautiful log home (unique inside and out), it is out of place and won't sell there (needs to be on a mountain lot or a more appropriate setting).   The family is motivated and interested in owner-financing, so that's a plus.  An investor friend in the area thinks it too risky to get involved with.   I think it could be a great opportunity but might need to buy and hold for now.   I would love your expert opinions.

Hi expert investors,

My husband's family inherited a large, gorgeous, historic 4 bedroom, 2+ bath, 3500 square-foot home in mid-state (upstate) New York (university town).  They wanted to sell the house and had it on the market for years while renting it to faculty from the nearby university.  They started the list price at $149K!!   As any of you who live in, own, or have purchased property in New York know, the biggest issue is property taxes.  We've paid for the home at least once since it has been on the market.  The taxes have been appealed and reduced but are still ridiculously high.  The realtor for this house/town is subpar at best (that's putting it kindly).  Since it was the first homestead in the town, it has historical significance, but it is old (1870s) and needs repairs periodically (painting, roof, plumbing, septic, especially).  It was completely remodeled in the late 90s/early 2000s.   It is located right across the street from a major university.  The family has offered to donate it to them, but the university has put that off (long story--bureaucracy is short version).  

The current renters considered a rent-to-buy situation but it looks likely they will be moving away by this fall (been there three years).  We don't want it to be left empty for winter.  There is an investor in town who has inquired a few times about buying it (wants to do so without the realtor commission) but has not followed through.  Now we need to put it back on the market or decide what to do with it longterm.

Can I get your input on what you would do:  sell it (at $119K, $109K, ??) or fix it up a bit more -- possibly add another bathroom, and rent it out on AirBnB?   The university town does not have many places for short-term rental (never enough for events in town -- during the year and especially in summer when they have a few big festivals, including a music fest), so short-term rentals are a plus there.   Then there's the problem of shortage of good contractors who follow through and don't gouge for work (not great either) completed (or not completed).   Timing is critical for this, so I'd appreciate your thoughts and opinions.