All Forum Posts by: Kathleen McCabe

Hi BP fam!

I’m a new investor, and I’m wondering if it’s possible / worth it to do a “half” brrrr. Im David Greene’s book, he is pretty insistent on saving enough money to do your first brrrr in all cash in order refi and get your nest egg back. I have about 40k saved, which is not enough to do a full brrrr in my area (Dallas). What if I did the following: traditional financing for my down payment , so 25k down on a 100k home that just needs cosmetic fixes (smaller rehab) for 15 grand.... and I boost the property value maybe to $125. Can I refi the money I put into it out of it (40k)?

Again, this is just a simplified example, of course. I’m trying to get into the game quickly, but should I wait to do a brrrr when I have all the cash?

Yes, I’m open to using hard money, just a bit nervous because I’ve never done full rehab before, figured this could be the more conservative option on a first investment.

Looking forward to hearing your replies! Thanks in advance.

-Katie

@Pete Woelfel Thank you for the solid advice. I will ask around locally and see if I can pull some financing together. I know very few people in the industry at this point but at least this will give me a good reason to start a conversation. 

Thanks,

Katie

@Daniel Cardona - It is not an auction home. It is for sale by owner. The description says "mainly" cosmetic repairs...

yea, I assume this deal will probably go to a cash buyer... but I'm still going to have the conversation for practice / education at the very least. 

There is a portion of the description that says " Outside of the 70K, the right buyer can simply take over the payments on the rest of the house while the rehab is being done. Monthly payments are 1,381" PITI. I would have to dig into that some more but perhaps that is why the price is so cheap?

@Mitch Messer Thank you for the reality check on numbers :) 700 a month still seems like solid cashflow in my opinion. How would you recommend I finance the rehab in my situation? Partner up or get a loan? If so which type of loan should I look at? 

and you're right I do need to slowwww down :) 

Hi all, I need some advice on a deal. I found a 3 bed / 3 bath house listed for 70K in Fort Worth Tx, 2,327 sqft. All the surrounding houses are listed for around 240K.

 The average rent for 3 bedrooms in the area is $1,500

Mortgage$273/Mo for 30 yrs fixed

Taxes $136

Insurance: 25

CASHFLOW: $1,066

According to the listing it should take about 30K or rehab, so to be safe I would make that 45K. ( I would of course get a few bids from contractors, but I saw the listing an hour ago so bare with me)

I can afford the down payment of 14K for 20% down. But that's all of my money.

I am expecting a minimum bonus at work next month of 15K - could be closer to 22K not sure yet.

Would this be worth getting under contract and getting some contractors to make estimates? I believe I could pull out if needed in 30 days, correct?

I am nervous about how I would afford the rehab. I could of course put my 15K bonus towards it next month but that would require me to come up with 30K line of credit somewhere and not sure where, and the uncertainty makes me nervous. Credit card? bank loan? I have a very strong w2 and good credit. 

What would you do? Am I jumping the gun? Initially I was going to save for money this next year so I could make a cash offer on something and brrrr but this deal seems too good to wait.

Thanks in advance :)

Katie 

Hi All, 

 Thank you so much for all of your input here - Maybe I should have used the word "Downturn" not crash... I did not intend for everyone to think that I meant wait for another Great Depression or 2008 :) My mistake. But I'm getting the feeling your replies would generally be the same - Don't wait.  

Big shout out to @Larry Turowski who risked getting some virtual down votes to go out on a limb and acknowledged that a downturn does cross his mind! For a minute I was thinking I was the only one.

@Greg Scott I really like the idea of the stress test! Thank you.

@Marc Winter - To your point, numbers don't lie! I can always fall back on this. :)

Everyone else who replied - You rock! I really appreciate the honesty and you've all encouraged me to get the ball rolling sooner rather than later.

Hi all! I'm getting anxious, I want to buy my first investment property, however I can't help but listen to the rumors of a crash in the next 1-3 years. Should I stock-pile my cash and wait, or get the ball rolling on my real estate empire and start investing asap ? Am I being too eager? 

Thanks!

Katie

@Brian Adzadi - Thanks for the reality check! lol I do not have 800K right now. (I wish!!)

@Scott Wolf - I think the appreciation game here may be the only thing that makes sense but you're right, not sure if that's what I want starting out. Thank you!

You're probably thinking, "She's crazy." "Why would she even ask this?"

I love NYC (before you call me out on making an emotional decision, hear me out haha).  Maybe I'm just clinging to the hope that it's not too saturated. One thing I know for sure it that rent is always consistent and if a tenant breaks lease you could replace them in 30 minutes. 

Also - Has anyone ever done a BRRR in NYC? I feel like there is less room for improvement if we aren't talking about a standalone home but I also feel like rents in NYC will ALWAYS go up. Maybe that's naïve?

Also - I'm sure you will suggest looking a little outside of NYC... But I'm really curious about Manhattan itself. I feel like there are many hidden gems with lots of passive income potential.

Thank you in advance :)

@Aaron Bihl hello! How is airbnb doing in San Antonio? Thinking about doing a STR there myself. How are the occupancy rates?