All Forum Posts by: Larry H.

We are doing our first flip in Denham Springs, LA, just outside of Baton Rouge. The house got about 5' of water and has been completely gutted ll the way to the studs throughout.  All electrical, plumbing, and AC will be brand new throughout.  Is a permit required for this type of work?  If a permit is not obtained what could be the consequence?

We are doing our first flip in Denham Springs, LA, just outside Baton Rouge. The house got about 5' of water and has been completely gutted all the way to the studs throughout. All electrical, plumbing, and AC will be brand new throughout. Is a permit required for this type of work? If a permit is not obtained what could be the consequence?

What area/neighborhood is your property in?  I am from the Baton Rouge area and also invest there.

Based on my experience, I'd bet you will never see a dime from her.  If you extend the lease for 3 weeks, or however long, she still won't pay.

@Bill Wicker you ain't kidding. We got about 4 multiplexes under contract only to find out they had more water damage than what was originally led on. Then, the sellers didn't want come off the price. They still wanted near market value for a flooded property.  

They're still damaged and still listed, and this happened about 6-8 months ago. 

@Tami DuBose we bought a house in Denham Springs. It's under construction now.  

I'm glad you tagged me in this. I've been brainstorming a solution to a possible opportunity. I'll email you. 

@Don Konipol, the seller is motivated in this deal.  The property has been on the market for about 6 months and they've lowered the price twice.  They refused two offers for seller financing the down payment, but are now considering our offer.  Negotiations stalled because I didn't have lender approval prior to making an offer.  I thought there was no sense in wasting the lender's time if I couldn't secure the down payment.  I have since contacted our lender in an effort to get negotiations going again.  

The property is in a C neighborhood which consists mostly of four-plexes and duplexes.  There are a few other medium sized apartments in the neighborhood, but no single families.

I have a good relationship with our lender and he knows I always present properties conservatively.  There is no sense in inflating a property on paper if it won't work in real life because then we all lose.  I have also been up front with the amount of cash we will have in the deal and what our plan is to pay off the down payment quickly.

I have submitted the deal to a couple crowd funding sites, so we will see what happens.

I found a 26 unit apartment complex that I'd really like to get.  It's in a neighborhood where we have two 4 plexes and cash flows well.  Problem is, I don't have the down payment (a little over $100k).  I have asked the seller to finance the down payment, but they are selling to use the money for another business venture, so I think they need their cash right away.

Even with 100% financed, (estimating 6.5% commercial loan plus 8% loan for the down payment, 24% budgeted for turnover, cap ex, and maintenance) the cap rate is 10.26% and debt coverage ratio is 1.27 and cash flows over $1000 per month.  AND these numbers are based on 80% occupancy, which is highly unlikely in this neighborhood.

Anyone have any experience with private lenders/investors who may be able to guide me in the right direction in getting this deal locked up? 

Should have mentioned, the house is in Denham Springs.

Who would I call to find out if a property needs to be raised? I looked up the property and got the lot elevation, but that doesn't really mean anything to me. I'd prefer to call the authority on the issue and talk to someone who knows what they're talking about. I am likely going to buy a flooded house in a flood zone AE, but I want to make sure it doesn't need to be raised. I'm getting it from my best friend, who is a contractor and has flipped and rehabbed numerous flooded homes. He already got the permit to do the work and said it does not need to be raised, but that is something I want to verify for myself.