All Forum Posts by: Kenneth Cheston

Hello Tykia!

Welcome to BP. Would be happy to connect if you want to message offline. I've got a fully renovated duplex in Baltimore City, but looking to tackle a 6-10 unit Multi-Family property next. Let's see if there's anyway we can help each other out!

Hi @Matt Holley,

Looks like you've already gotten some great advice. I bought my first duplex in Baltimore last year and have had about 6 months on the books for renting to tenants.

Just to give you an example.

I bought it for $140,000 ($135,000 FHA loan) and it appraised for $210,000 after renovations. I called around and I was able to get 85% LTV for a HEL. I had $43,500 available to me, but I chose $23,000 so that it didn't kill my current cashflow. The HEL is a fixed rate unlike the HELOC. Drew is right that it's unlikely you'll be able to access that 30k due to LTV limitations (don't know your loan to value). There's also closing costs associated with HELs & Cash-Out Refis that will probably make it not worth it. Helocs don't have any I believe.

Try calling SECU. I talked to them recently and they said they could do a HELOC on investment properties for 90% LTV with a credit higher than 740. But definitely give caution to over leveraging at this time and it may wipe out what cashflow you have now. It's always worth doing some research just to see how the numbers pan out.

Sometimes it's better to explore getting money out of the property before transferring to LLC because you can get better terms as an individual; however, it's an inherent risk not having that added protection.

Let me know if you want to chat further on messaging! I'm a local investor to your area and always love networking.

Welcome @Zoe Thomas! BP is a huge inspiration for me. Especially the books and podcasts! I started my journey last year when I house-hacked a duplex in Baltimore which is now reno/rented. Shoot me a message if you want to chat! Always great talking to a local investor.

Quote from @James Horn:

Hello everyone! For the past month and a half I have been spending a lot of my time learning as much as I can about real estate. I am beyond eager to get into the game and start my journey. Currently I am employed as a Landscaping Foreman. Handyman work is something I currently can bring to a table. But with more knowledge incoming, means more experience. Looking forward to talking to anyone about anything. Even just a chat! 

Welcome James! BP has been a lifeline for me and a source of inspiration. I am a rookie investor in Baltimore, but house hacked a duplex last year that is fully reno/rented now. The market is cooling off a little, but interest rates are climbing so it's an interesting time. I'm happy to connect in direct messages if you have any questions or just want to chat! Best of luck man.

Quote from @Tom Siller:

I got burned bad on a rental property in Baltimore. Property was full rehab a couple years ago so likely prices out most of the BRRR/flipper crowd.

Looking to sell it, but don't want to lose my shirt. Would be prime for someone looking to buy and place a tenant.  Any suggestions on how to get this sold quickly? 

 Hi Tom - I'm sorry to hear that you got burned bad on a rental in Baltimore. I can certainly relate to discovering surprises after the purchase of a property. I'm currently in the search for a property and may be able to help you out. Feel free to direct message me. Wish you the best of luck in future endeavors!

Quote from @Sam Bhattacharya:

Quote from @Kenneth Cheston:

Hi Holly! I share Kyle's welcome! Kyle is a great lender. I actually spoke with him on the phone over a year ago when I first got started. 

I personally bought my first investment property a year ago in Overlea neighborhood of Baltimore. It was a duplex and ended turning out to be a great choice. Having said this, Baltimore is certainly a city with it's disadvantages just like any city. You really have to know the neighborhoods so that you don't end up buying in a bad area. You're right about the population, but to be honest there's still half a million people living in the city plus you have big employers like John Hopkins Hospital + University, University of Maryland, Amazon, and Under Armour (many more). I'm not sure if I've ever shared this, but I did a whole research package when I had my doubts about Baltimore. See link Baltimore Invesment Area Research. The reality is that there are thousands of investors here that continue to invest. Baltimore may be on the come-up or it may not be but there's still a TON of people that need a place to live. Hope this helps.

Hi Kenneth, thank you for sharing those details in your link.  

How good is Baltimore for Brrrr?  Is it realistic to find deals where you get all of your buying and rehabbing money back when you refinance?

Wow great feedback from Tim and Russell. Sam, definitely agree with Russell. I've only done one deal so I default to those guys on knowing way more than myself. My first deal I house-hacked and did a partial BRRR by taking out a HEL. I was 66k into the deal and took out 23k although I could have gone higher up to 40k but didn't want to hurt the cash flow too much. It's a balance, but generally a full 100% BRRR is really hard in Baltimore I think. But hey.... even if it's a partial BRRR that's a great deal. All depends on what final numbers you are looking for. 

Thanks Russell! Making sure I turn over every stone. Appreciate your insight.

Hi Holly! I share Kyle's welcome! Kyle is a great lender. I actually spoke with him on the phone over a year ago when I first got started. 

I personally bought my first investment property a year ago in Overlea neighborhood of Baltimore. It was a duplex and ended turning out to be a great choice. Having said this, Baltimore is certainly a city with it's disadvantages just like any city. You really have to know the neighborhoods so that you don't end up buying in a bad area. You're right about the population, but to be honest there's still half a million people living in the city plus you have big employers like John Hopkins Hospital + University, University of Maryland, Amazon, and Under Armour (many more). I'm not sure if I've ever shared this, but I did a whole research package when I had my doubts about Baltimore. See link Baltimore Invesment Area Research. The reality is that there are thousands of investors here that continue to invest. Baltimore may be on the come-up or it may not be but there's still a TON of people that need a place to live. Hope this helps.

Hi BP Baltimore,

I've got one duplex up and running. Looking to do my second. Just spent a few hours calling banks in Baltimore but can't get anything creative. I got a bank out in West Virginia (for a STR venture I was looking at) that was able to do LTV 90% 10/1 ARM with a 6.5% rate. The best I could find in Baltimore so far is LTV 75% 3/1 ARM with a 5.375% rate. Don't get me wrong, that's pretty good for nowadays, but looking to get that LTV up. Anyone had any luck? If you suggestion is private then I could look into that. Looking for bank recs at the moment. Thanks.

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $140,000
Cash invested: $40,000

House Hack BRRR

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

Low money down, high rent, high appreciation

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

Direct Mail. Off market. I took the asking price (during the pandemic).

How did you finance this deal?

FHA 3.5%

How did you add value to the deal?

DIY renovate lower unit. Hired contractor for top unit.

What was the outcome?

15% Coc ROI after I pulled $23k out using a HEL.

Lessons learned? Challenges?

I was very slow due to the DIY and not actually living in the property half the time. Next time I'm just going to hire a contractor for the entire job and keep it under 3-4 months.

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

No agents. They aren't really that helpful when tracking down deals. I used a mortgage broker.