All Forum Posts by: Mike Mosby

When you refinance, you do it at an apprised value of 300k. So the bank lends you 75% of that which is 225k.  Since you paid 150k for the property, you have 75k in profit in your pocket. And because you picked confusing numbers, you also have 75k in equity left in the property (225k-300k).  

@michael G may have a typo-he means profit, not debt.  You still owe the bank 225k and are making payments on that. 

If I lend you 150k to buy a house.  Then Michael G lends you 225k for that same house. You can pay me back my 150k, you get to keep 75k but you still owe Michael G 225k. 

Lots of great questions.  Your monthly mortgage payment will be based on 300,000.  So put that into any mortgage calculator, include the taxes and insurance for your property to figure out your payment.

You will have 75K in equity.

Your profit will be the difference of 225k minus (purchase price (100k) + reno (50K) + closing cost (TBD) + holding cost (TBD)).  At closing you will walk a way with a check based on that calculation.  You will owe the bank 255K for a property worth 300K which will be your equity.

Hope that helps a bit. You will have a lot more questions so keep them coming! I recommend you check out the BRRR Calculator to help with the numbers: https://www.biggerpockets.com/...

I just posted this deal in the marketplace and want to make sure it makes sense for a turnkey rental opportunity.  Looks good to me.. but I'm biased :)

View report

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

@Greg Scott Thanks for that very detailed response!  It's clear that your strategy has significant merits that are worth considering.  

@Greg Scott Very interesting idea.  I did the math and I would get less than half of my 401k balance. How does such a low disbursement factor into your strategy?

Great question @Eric James, I just reached out directly.  We'll find out without wasting time!

Love your analysis here.  Did you decide to move forward?  If not, did you research what happened to the property?  

I was looking through some listings on Propstream and found a house that has reached the "Notice of Trustee's Sale" stage of pre-foreclosure but it shows it was purchased in cash so there is no mortgage on the property.  Any ideas on how to lock up this property before the auction?  Or any ideas on how a cash purchase ends up in foreclosure?

There are a lot of "Turn-key" investment companies selling Chicago properties to out-of-state investors.  I would consider Dolton C/-D+ area.  If that is the class of investment you are looking for then it might make sense for you.

@Sheila Villacampa 

I am VERY impressed by you!  You have proven that hard work and dedication to your goal can help you reach your dreams.  It appears that you were well on your way to your goal, then your circumstances changed.  It may be time to reevaluate those goals so they fit with your new family life.

The two negative cashflow properties should probably be ditched so you can refocus your RE goals.  Why do you keep those properties in your portfolio?

If I were in your situation, I would post all of the details of the 5 properties you own here and ask for advice on what to do with each.  That way you can drop some of the RE stress in your life which will in turn help reduce the relationship stress in your life.

No matter what course of action you take, I have a good feeling you will be just fine in the long run!  You have done more than 99% people who have RE dreams!  You are an inspiration to others who are too scared or lazy to get started.

Best wishes!

Mike