All Forum Posts by: Tanner Pile

What did you end up doing with the garage? Did you make renovations and what kind? Did you live in the garage?

Investor! What are your thoughts on refinancing after a cosmetic rehab in the current state of the market? 

I'm currently house hacking a duplex that I want to do a cosmetic rehab to and then refinance after. I do not have the cash so will need to borrow money and look to refi to pay off private lenders. My concern is with prices lowering the rehab will not add enough value to refinance and pull the cash out to pay off the private lenders. Any ideas?

The fix n flippers I know are still flipping. Only they are being more strict on the deals they buy do to the uncertainty of the market and lower home prices. 

In Colorado Springs the best way to generate a large amount of cash flow short term is by having a large portfolio of STRs or renting by the room. These two strategies will get you to that goal faster. 

You can get $100-200 per door on a long term rental in Colorado. STR will be closer to $400-500 per door if done correctly. This is based on the personal numbers I run when analyzing deals In Colorado Springs

When I house hacked a duplex this year in Colorado I rented out the other unit and the other bedrooms in my unit to get a lower monthly payment than I would be for paying rent in the area. As long as you're paying lower than rent in the area it's a good deal. You could look to doing an STR on the other unit to increase your cash flow.

Yes, if you purchase through an LLC they will require that. You could buy in your personal name and then after closing transfer it to the LLC.

I went to school in Pueblo for four years and know the market pretty well. I do deals there from time to time but I do not like it for a market to invest in. There are a few areas around the college campus (CSUP), North Pueblo, and Pueblo West That are the better areas if you do decide to take that route. Pueblo West is almost another small city with in Pueblo and is newer builds and larger lots near the Pueblo Reservoir. 

Hi Darien, 

I think the BRRR method is the way to go! A good way to max your capital is to have your partner in Denver purchase a primary and rent out rooms and or units and then do a 20-25% down payment for the other property. This way you get 2 properties going.

You could also look to do a 10% down second home property. This would be more for a buy and hold strategy and use the other $50k for another strategy. 

Having only $100k I think the best route is BRRR as of now unless you have a way to get more capital for rehab costs.

Hard Money and Private Money could also help get the first deal moving. 

What draws you to the Colorado Springs Market?

5% is the best option. Anything less and the broker will slack off and not do all they can to get you top dollar. This will also allow them a higher budget for marketing. 

The ones marketing at 1% or 2% are what you would pay them most likely and they don't mention the buyers agent commission which the seller usually pays for. 

At 4% it is offering a buyer agent a lower commission. A buyers agent deciding which property to push their buyer towards will steer to the higher commission. All things to consider when trying to get your property sold in a timely manner. 

Hi Alleigh, 

With doing a HELOC make sure you run your numbers so the revenue from the STR will cover the HELOC monthly payment. A cash out refinance could be possible and you would not need to worry about the revenue covering any additional cost other than the STR expense. However this would require a new mortgage rate and you likely have a pretty good one compared to current rates. Not impossible though! Another option is a DSCR loan .This does not look at your personal income but the income of the property. I have someone local in COS that can help with this!

Are you looking to purchase a STR in Colorado Springs? Seller financing is possible but with the city regulations it's difficult to find a deal for seller financing that also qualifies as a STR in the city of COS. The permits stay with the owner not the property so even when a property is sold it may not still qualify for a STR permit.

Hey Michael, 

Have you looked into refinancing and then paying off all your debts? Then possibly doing another HELOC or using extra funds from the refi to make your next purchase or even using the rental income to save for the next purchase?

There's many routes to take, and may take some math to figure out which one is best and saves the most money.