All Forum Posts by: Larry Richardson

Something must have went wrong. That should have been a 30k purchase, roughly 20k in clear profit. Ok, so the 39k would be the MAO. Its listed at 30, so even a few thousand off that maybe. Its the way that calc works I guess.

So a couple of things pop out
1. Fails 50% rule
2. Everyone is different, but I'm not going to tie up $75K for 4% return, 
3. Income fails a 1% guideline.

4. Vacancy risk - I realize this is a duplex, but you'll need to have 20 mos fully rented to make up for 1 month of vacancy. 

Notes : 
10k is a wag. Looks like paint, cleanup and some LVP flooring. I'd plan on doing this myself ( I know, time value).   
Comps include a 72K sale of essentially same house, 4 doors down 6mos ago.  

Forgot to update the holding costs to $400 a month, but still within a decent profit. I'll see if I can edit. 
This is in a "C" area I'd say.  

Questions : Using a HML, would they be interested in a loan on this type of a property ? ( the purchase being so low)

https://www.biggerpockets.com/...

*This link comes directly from our calculators, based on information input by the member who posted.

Well, Dennis was frank about it. I wouldn't be excited at all at a 
1. 6.6% CoC
2. 100 mo cash flow 
3. Only a $2500 increase in value.  

I can't imagine my time would be worth pursuing this, but everyone has different priorities. I think there are probably better deals to be had.

@Carl Fischer - I wonder, can you do the maintenance, but not take PAYMENT for it ? I am thinking that is the spirit of the regulation - They don't want you using your 401k to put cash in your pocket.  Interesting point I think. 

I'm on the same page as @Jaysen Medhurst That cash flow seems too close for me. Couple months vacancy, and you're out of pocket for a good chunk.

This would depend on your plans 401k documents.. The IRS doesn't specifically disallow this (unless you are a disqualified person). Be careful about any self management or maintenance. There are some narrow loopholes in that area, but tread lightly.  

There is a Pro on here @Dmitriy Fomichenko  that I would trust with reviewing this . He's with Sense Financial 

Couple of questions -- 

HML - 12% ?

100% finance of the repairs + purchase? I've rarely found more than 90% 

Other than that, the CoC is ok, but not what I would say a slam dunk. The flow, 1 vacancy for 2 mos would seriously hurt, even with the reserves. Is it currently rented ?
 

Nice cash flow on a duplex there. With that area, should be good on renting as well. The ARV shows as 10k, guessing that is an error. Unless your self managing, that management cost is low.