All Forum Posts by: Victor Morgan

Has anyone purchased a property at the Master-in-Equity foreclosure sales in Anderson County, South Carolina? 

A property that I have been looking to purchase for a while will be showing up at the sale in the coming months and I'm interested in learning more about the sale procedure, best-practice bidding strategies and any other general advice from the Bigger Pocket community.

I'd also be interested in hearing about some of the better insurance companies to work with for multi-family units. I'm closing on a 4-plex early next year and the rates that I'm getting (based on a very high replacement cost estimate) are much higher than what is currently listed in the sellers disclosure.

Hello BiggerPockets Members.

I'm interested in purchasing multi-family properties in the Upstate SC area, preferably at an 8% cap-rate or greater and with some upside potential (RUBS/metered utilities, rent-increases, better management etc) in off-market deals. The dollar amount should be <1MM, but for the right deal, I could pull together investors.

If you have experience in this area, I could use some help growing my connections.

Who are the best/biggest multi-family brokers that I should connect with?

Who is giving the best multi-family (>4 units) loan-terms at this time?

Alternatively, if you know of a property that might work, please let me know.

I look forward to more actively engaging with the BiggerPockets community as I begin to ramp-up my investments.

Thanks in Advance,

Victor

Hello BiggerPocket Community,

I currently have one rental (the home that I used to live in) and am refinancing so I will soon have ~60k to spend on purchasing rental properties.

I'm looking at two properties and would appreciate the communities feedback in the purchases as well as in the structure of the deals.

Property 1. 28k house, can pay cash, currently rented for $450 per month by the same person for the last 13 years (according to the listing agent). After taxes, upkeep and insurance, I'd cash-flow ~300 per month for a CAP rate of ~13%. Could inquire about owner-financing, however its an estate sale and the heirs likely want cash.

Property 2. ~40k house and get owner financing for the remainder. Currently rented for $650. Would ask for 20k down, 20k owner-financed at 8% for 5 years. After taxes, insurance, upkeep and vacancy, I'd be able to have a positive cash-flow of ~70 per month for a CAP rate of 14.5 and an ROI of 25%.

These houses have been updated consistent with the standards of the neighborhood, but one of them will likely need a roof in a few years. Obviously neither are currently in the best areas, but  the city is growing and there is a possibility for some appreciation. The numbers seem to work even if I sell the units at the purchase price years down-the-road.

The remaining funds will be kept in reserve for about a year in case a surprise develops with the houses/renters.

Questions:

-are the structures of the deals reasonable (interest rate, timeline, percent down)?

-is anything hidden in the numbers that I quoted that raises red-flags that I may have missed something glaring?

-my current rental property is worth ~200k, these will be my first rentals on the lower-income side of town. Any advice/recommendations about differences to expect and the best way to handle them?

To be clear, I am not expecting the insurance company to spend any money on the roof. The roof is a "pre-existing condition" and was built into the purchase price. My plan was to paying for the roofing repair out of pocket immediately after closing with my own funds.

According to the insurance companies I have talked to, they will even deny coverage to roofs within 3-4 years of their expected end-of-life, or if a certain number of shingles are blown off of the house.

The house passed the appraisal and "no signs of deferred maintenance were noticed". Perhaps my definition of "needs roof repair/a new roof" and the lenders definition are different. In retrospect, I was likely too forthcoming with the insurance companies.

The house is habitable, there is no interior water damage, but many shingles have been blown off and the inspector and roofing contractors recommended a new roof or varying degrees of repair.

I've been reading these forums for several months and would like to thank the members for sharing their expertise. I have learned a great deal about real-estate investing and operating a rental.

The home I am currently purchasing as my main residence is an as-is short-sale at below market value including repairs. Although there are many minor repair items, the house either needs significant roof patching or replacement. I have factored the repair costs into the price offer and am planning on paying out of pocket immediately after closing, but have hit an unforeseen snag.

The mortgage company requires insurance, but no major insurance company that I have called will insure a house that needs a new roof, even if it replaced ASAP after closing with funds from the new owner.

I'm sure that I'm not the first person that this has happened to, what good options do I have?

Are there any "temporary" insurance companies that would bridge the gap between closing and the completed repairs (~30-60 days)?

Could the current owner file insurance and take funds from the escrow account to pay the deductible?

Are there insurance companies out there who do this that I just haven't found yet?

or am I just being to honest with the insurance companies because when they send an inspector I will have already repaired/replaced the roof?