All Forum Posts by: Randall Williams

Darren Budahn , thanks for the reply. The bank did a 'valuation' of comps to decide how much they would allow in a loan against it. The market won't pay more than $90 for it now, maaaybe $100 at very most. And yes, I own it free and clear. Would you finance another place at 100% if the cashflow was good? Or drop some liquid to make cashflow better?

Hi gang, would appreciate your thoughts on this one. 

I'm buying a second duplex, using financing from my first duplex. I bought the first 6 months ago at $82K, the bank values it at $140K. ($90K is likely resale value.)

Second duplex is selling for $80, needs $10K worth of work. I'm considering taking $90K against my first property at 5% to buy this one outright plus reno costs, and keep my (currently +6.5%) liquid investments liquid. (Likely resale value on this second duplex is $110)

Downside: more financing = more exposure to risk (the loan is 20 yr, first 5 years fixed, then floating.) downside is less cash flow because more goes to debt service. Upside: I keep the liquid for other things if needed, including paying the loan off if the interest rate suddenly goes ballistic in 5 years.

OR: should I drop $30K into the house, and finance $60? It makes a smaller monthly note, but ties up more capital. Better to keep the liquid capital accessible, right?

Any ideas on that would be mucho appreciated, thanks!

R

@Account Closed, keep in touch as you hunt for more properties. I'm in Bath and always looking, I'd be happy to send some addresses your way if I know what you're after. 

@Mike Roy, where's your 4-plex in Bath? I was looking at the one for auction in Elm St, but they've got a reserve at $109K, and we're guessing $40 on rehab (new boiler, etc.) 

There's a 9-unit for sale in Brunswick now for $369K - 91 Pleasant St. Looks like a bunch of deferred maintenance though. 

Bruce, why Brunswick and not Auburn if you're already there? Curious if you see something different in the market down this way (I'm in Bath.)

@Carl Hebert, are your multis in Auburn? If so, how's it going? I see good deals up there, but I've been loathe to leap because I'm in Bath and not as close as I'd like to be. 

@Michael Webster, 

What do you think of Bath/Brunswick compared to Saco? I really like hands-off (I live in Bath) and want to stay close to home but am thinking of branching out. 

And Alex, Lewiston's worth checking out thoroughly beforehand. I'm just down the road and see great prices there often that I don't even look at.

Heya Dave Holman ! Yep, let's. There are a few others around, too, we can also stage a meetup. Drop me a pm with your number?

I'm getting 2% here in midcoast Maine for my first duplex, though it's hard to find more that cashflow like that in good areas. Single family won't do it here. East Texas is supposed to be doing well for this now.

@Heather Rapaglia, try the 70% rule calculator on this site, as well as the rental deal calculator and see what you think. This deal seems like it'll cost more than expected and you could loose a good deal on it.