All Forum Posts by: Rick Levada

@Brian Gee where is it located?

@Brian Gee since this was my first project I learned a ton! My biggest lessons were to be more organized in both budgeting and planning the phases of rehab. I used a “friend” as a handyman and really just hit projects randomly as time would allow. Next time I will be detailed and have specific phases to be completed and won’t move to the next one until the first is done. I also learned a lot about what to look for before purchasing. Since I was involved in most of the rehab all of the surprises are now things I know to look for next time.

@Brian Gee. Went well. I only had to level a small addition but it was built so poorly it cost way more than I was anticipating.

@Brian

@Brian Carignan I did close!!  It's been a whirlwind few weeks but the rehab is ongoing and busting budget as expected!  Here are a few speed bumps encountered:

1.  The house appraised where I thought it would but the appraiser said with additional upgrades the appraisal would be about 15K higher.  The hard money lender wanted the recommended upgrades done and forced me to front most of the cash in escrow.  This more than doubled the required money at closing...which they informed me of the day before closing!

2.  The hard money lended isn't flexible with the money in escrow.  There is a DIY addition on the house that was way out of whack.  The repair cost 6500 which wasn't included in the original repair estimates.  I also decided to replace the HVAC as the unit was very old and would likely fail in the near future...not to mention it had multiple code violations in it's installation.  I asked for a draw to pay the foundation and said I would complete other repairs with cash on hand.  They are still "deciding" if they are going to allow me to reallocate these funds for these purposes.  

3.  So many trips to Home Depot add up!!  Sheet rock here, studs there, need some extra tools....the list goes on but every day seems to be 300-500 bucks.  Thought I could save by doing some of this stuff myself but those savings seem to be minimal given the time I am spending doing them.  

All in all the numbers are still working and I feel good about some extra up front costs that will hopefully provide peace of mind for the next 10 years or so.  I've made some great connections with a handyman and other professionals that will make it much easier on the next one.  I will share some photos in the near future.  Thanks for checking in!!

Hi Donovan. I just closed on my first property in San Antonio and am in the process of rehabbing now. I'd love to hear what you get going in the area as I'm looking to BRRR myself into a stable portfolio.

@Juan Mendoza, @Justin Merod, @Steven Gillmer, @Travis Buck, @Justin M., @Ian Walsh, @Scott Marshall So...supposed to close today. Wondering if anyone has experienced something similar: project being funded with hard money. Set up the process and had all numbers set. I was really close with my projected numbers (purchase price 85K with 5K for cosmetic touch up and ARV of 127K). The appraiser said if the flooring was updated, HVAC updated and appliances were replaced it would appraise for 150K. The hard money lender then said they will require those updates to fund. Now I have to come to closing with 9K more than planned to make the deal work. The numbers still work for the project and I should be able to get all of that back when I refinance out.

Has anyone else been forced to do maintenance that could have been deferred in order to fund.  Still moving forward but didn't like the terms.  I have to put 12K of my own cash into an escrow and request draws when the work is complete...and pay draw fees!!

@Juan Mendoza....Seller told me it needed to be leveled and painted.  He told me it had a new roof and was recently vacant.  Inspection found old cast iron plumbing leaks, major water damage from a previously leaky roof, multiple electrical and gas code violations and termite damage.  The inspection also educated me on things like water heater codes (exhaust was out of code tolerance and there was major floor rot due to a leaky tank) as well as signs of water damage I wasn't familiar with.

I put my first solid property under contract this week! I had a triplex under contract earlier this month but the seller/agent smelled my inexperience and tried to sell me a dud. Thank god for the option period! The inspection uncovered potentially catastrophic issues. Found me a smaller SFH project and the experience gained from the first near-miss was invaluable. Thanks to all who have provided guidance and advice. Much appreciated. Now it's on to the rehab estimate analysis!!

@Seth Teel, @Renay Reese, @Miles Stanley

Can you recommend a trustworthy company?  I submitted an offer for the property and will need to get rolling with bids!

I am currently looking at a triplex in town. The seller is asking 99K. 2 units are 1/1 and renting at 450 a piece. The main house is an 1100sf 2/1 that I'd like to make a 3/1. If I can make a 3/1 I am confident I can get 1100 a month in this area. My agent has a market analysis advising the ARV as a 2/1 is 132K. Here is my idea but I would like your feedback as I may be pushing too hard and getting emotionally attached:

1.  Offer 90K.  The owner is an agent and when he showed me the property he was adamant he wouldn't budge too much and he'd already turned down a cash offer at 85K.

2.  Secure a hard money loan for 105K to buy and put 15K into foundation work (pier and beam leveling) and framing the 3rd bedroom.  I will do all other interior/exterior work myself.  

3. Refinance out at 75% ARV (105K) leaving me with closing costs out of pocket and recouping my down payment.

I'd love to hear anyone else's analysis.  I'd also love to hear recommendations on resources.  I applied for hard money with wildcat lending and have been working with prime lending in San Antonio for the refinance after.  

I'm not sure what the etiquette is on here but if anyone wants to direct message me and discuss the specific property let me know.  Is it bad form to post on here?  

Thanks in advance.

Rick