All Forum Posts by: Nnabuenyi Anigbogu

I agree with @Tim Johnson but i would go even further to say that low 400's is still not a good deal.

Using the 70% rule of thumb you get 785 * .70 = 549.5K
549.5k-260K = $289.5K

Even before you factor in your wholesale fee you are already around 300K as the offer price. The killer is the 260K in repairs. 

even if you get it at 400K, once you add 260K and your 10K fee you are at 670K. Any rehabber that takes that deal will not make much money once you add in closing costs and money costs. Factor 48K realtor costs + 30-40K money costs and you are at 27-37K Profit. For this big of a deal that is meager profit. Even if the rehabber buys with all cash they will make around 67K which seems good but is about a 10% return.

From what i have seen there is nothing bad about them. However all they do is essentially apply for a bunch of credit cards on your behalf. You will then pay them a fee based on how much they get for you. 

@Lane Pate

when you say 330 a month in cash flow what does that mean? Is that the rental income - PITI?

I ask this because most people who start out thing that cash flow is whatever you have left after you pay your mortgage and that is not true. That is a good way to lose money. If you are calculating it right then you can ignore everything i just said.

Happy Birthday JD. Thanks for a great site and great podcasts.

Congrats. That is an excellent flip. And being able to do it all cash certainly increased your return. I wish i could flip with Cash in my area. You would need 300-400K to do that here.

You can get a realtor if you really want. However a good attorney can help you just as much and costs less than a realtor.  A good attorney will have title company recommendations, know how to transfer the leases, etc? A good loan officer can help you with dealing with the mortgage company. You can get recommendations for both of those in your area right here on BP.

If you had not found a house already i would say you should get an agent. However at this point an agent is just going to cost you money. Chances are that if the seller is FSBO you can negotiate with them using the caveat that you have no agent so they should decrease the price accordingly (if they priced in a buyers agent commission). If they refuse you could always go ahead and retain the services of an agent at that point.

Hi Tim,

Welcome to BP. You will definitely find some good advice.

I just wanted to point out that if your budget is in the 150K range as you mentioned, then it will be very near to impossible to find a property in any of the areas that you are stating you want to live in. Even in the good cheaper outer neighborhoods of Chicago (avondale, Albany park, Jefferson park) you will not find a good multifamily for less than 300K. Even a fixer upper can run 250K and above for a 2 flat. So your budget will put you farther south or farther west which are not the best neighborhoods to live in.  The areas you mentioned around Depaul or in south loop you can barely even buy a condo for 150K much less a multi.

If you W2 income is decent and you have at least 15K saved you could go FHA and that can increase your purchasing power up to and maybe over 400K. (3.5% of 400 is 14K).

@Account Closed I have talked to Brian over the phone before and he seems very knowledgeable. I have not used his services so i have no dog in the fight.

However a negative review after 3 months where you have not made any money seems to be unfair to me. It easily takes 6+ months to even close the first deal for most investors and up to a year to be profitable. If you have a negative review then state why. Is he not providing guidance, not easy to reach, methods don't work? Please state more intricate details. If the only issue is that you have not made money given the short time frame then that is not exactly a good basis for a review in my opinion.

Congrats @John Casmon 

Looking forward to getting through the flip. I can't wait to catch up with you on the rental front one day.

@Wayne Brooks I have read them and did not see anything related to what my loan officer was telling me which was why i wanted to pose the question here. According to him it was just implemented this month so it might not be documented publicly yet. Apparently he got it in the underwriting update his bank gets.

Im trying to substantiate what he is saying but havent been able to.