All Forum Posts by: Nicholas Z.

@Dave Spooner thanks for the encouragement. I only recently grasped the concept of money velocity and am trying to make up for lost time. I'd love to do a BRRRR but there are a variety of factors preventing me from doing so right now, so turnkey at least gets me in the game. (That's also why I'm looking at being a private lender for BRRRRs.)

Thanks @Bryan Noth!

@Dave Spooner yes, I do intend to continue investing. I'm investigating some turnkey single-family rentals right now (I know I miss the forced appreciation, but just looking to get started with guidance), as well as looking at doing some private lending and mortgage note investing. I spent the first six months of this year reading and researching and now I'm ready to spring into action! (Which includes signing up for Bigger Pockets after lurking for most of the year.)

Investment Info:

Single-family residence buy & hold investment in Sun City West.

Purchase price: $250,000
Cash invested: $62,500

Two bedroom/two bath, 1900 sq ft, garage, private backyard in gated over-55 community.

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

The company I worked for had just gone IPO and I had a bit of money I wanted to invest outside of the stock market. My mom had dreamed of having a winter house in Arizona so I told her if she could find a place she liked for $250,000 then I’d buy it and she could use it for three months a year and I’d rent it out the other nine months.

I figured retirees are a good target renter demographic as they have consistent income from pensions/retirement accounts/annuities/etc. that won’t change dramatically at any point. Plus, I figured many would rather rent than own in retirement so they could have more cash on hand. Arizona is a retirement destination so people usually sell their houses elsewhere and move there.

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

My mom actually did all the legwork. She found a realtor, picked out various locations, and traveled there to look at properties in person.

How did you finance this deal?

Conventional financing, 25% down and 4.5% for 30-year mortgage.

How did you add value to the deal?

The house appraised for $265,000, so I already made money on purchase. The house had been unloved by its previous owner, so we were able to fix up some of the easy stuff (fixed electrical issues, new master bath shower, redid the entryway courtyard).

What was the outcome?

Well, my parents fell in love with the place so they spend half the year there. We decided not to rent it out the other half of the year so they wouldn’t worry about damage to the property. They pay for their own utilities and generally make sure the place is taken care of.

After putting in $30,000 of work, the place is now worth at least $350,000, with prices in the area appreciating nicely.

Lessons learned? Challenges?

I really lucked into a good investment here by accident. If I could rent it out, it would cash flow at around $300/month. I plan on holding onto it at least as long as my parents continue to use it and will either turn it into a rental afterwards or 1031 into another property.

Biggest lesson learned: make sure your parents don’t fall in love with your rental property.

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

Bob Nachman was our agent and he was fantastic. Very detail-oriented, helped me with a local mortgage broker and arranged everything perfectly. Highly recommended.

@Jay Chopra thanks, let me research NJ a bit and I’ll reach out if I feel like it’s a good fit for me. 

@Chris Seveney thanks for the thoughts on mortgage notes. I’m reading up on those now.
@Jaspreet Baveja

@Jaspreet Baveja thanks so much for the fantastic details. I’m writing all of this down to go over and make sure I understand. I’d love to connect after I’ve done a bit more research.

@Jesse Daconta thanks for the recommendation, I’ll check it out. I was thinking of starting with smaller BRRRRs until I get the hang of it, but will definitely take a look at the book.

@Kenneth Garrett thanks, I'll definitely check out the podcast. I was thinking of starting with BRRRR down payment lending. It seems like with that I'd end up in second lien position?

Hi everyone,

After several false starts in my real estate investing journey, I feel like I’m finally educated enough to give it another try.

Due to my current situation (dealing with health issues and primary source of income being disability), I don’t have the energy to do a lot of the legwork necessary to succeed in buying/evaluating/managing properties nor the income for (more) conventional loans.

I do, however, have access to capital thanks to managing my money well before my health changed. As such, it seems like becoming a private money lender would be a good way to still participate in real estate using what I have. 

My question: how does one get started doing private money lending? I’ve read a lot about it but haven’t found much about the first steps to head in that direction.

Thanks for any advice!