All Forum Posts by: Seth Domoto

Thanks for the replies everyone!

@Nate Jones our agent also recommended Prime Transfer, so it good to know you have had repeated positive experiences with them!

Hi everyone, went under contract on a home in Lancaster, PA yesterday. Looking for recommendations for reputable title companies and home inspectors you or someone you know have used. Thanks in advance!

Hi everyone, went under contract on a home in Lancaster, PA yesterday.  Looking for recommendations for reputable title companies and home inspectors you or someone you know have used.  Thanks in advance!

Thanks for your input @Chris Masoni'm not sure I'm following you on the term and rate on my private loan potentially not being as good as from a bank?  Could you clarify?

BTW my private loan is 3% interest only and there is no set term (i.e. I can pay off the principal whenever I choose).  This makes for great cash flow and allows me to accumulate capital for other investments, since I am not making principal payments, but on the other hand I am not building equity other than what has accrued through appreciation.

I have a private loan from a family member for a REO property I purchased 6 years ago as an owner-occupant. The loan is for $120k with 3% interest only payments each month. The loan terms call for me to re-pay the $120k principal if/when I decide to sell the property. I purchased for $140k and I am confident given the improvements I made and the current market, it would appraise for $200-$225k.

The property is now a rental and is producing significant monthly cash flow (approx. 35-38%).  Given the additional equity build-up, would it make sense to go to a bank and "re-finance" by getting a traditional mortgage, freeing up additional capital (due to the increase in equity) for me to utilize on other deals?  Is this even possible?

One thing to keep in mind is since it is now an investment property I'm guessing the bank rate would be somewhere in the 4-4.5% range.

@Andy Luick

The current owners lived in the property for the first 6-7 years then rented it up until June 2015; it has been vacant since.  I believe it is for sale now because the owners have purchased a home elsewhere and are no longer interested in renting it out.

Appreciate the suggestion on 8-10% vacancy and I will take that into account.

@Christopher

I forgot to mention I included 5% vacancy in the calculation.

Recently there has been a change of plans....we are intending to purchase the property all cash at $75-80k, make some minor upgrades, place a Tenant and a few months down the road hope to get it appraised at minimum $100k.  If appraisal comes in $100k or higher, we intend to get bank financing and with the improved equity position, put no money down and move onto the next deal.  

I will say this would be the first for this type of approach, so thoughts/comments are welcome!

Thanks for reading!

I have come across what I believe is a fairly good deal (should I obtain the property for the right price of course).  I plan to purchase the property with my brother so he will run property management.  Here are the details:

Duplex (Southern PA).  Move-in ready.

Asking price: $99,999

Best and final offer: $85,000

Financing: 20-25% down

Taxes: $2,627

Conservative rent: $1,000/month

Repairs budget: 5%

Insurance: $45/month (est.)

Property Mgmt: N/A (self-performed)

Based on these assumptions I am coming up with a little over 19% Cash-on-cash returns each month.

Apologies if I left anything out.  If you have any questions please ask, but I am open to any and all opinions or feedback.

Thanks!