All Forum Posts by: Taylor White

@Fred Cannon Thanks for the reply!

By "current value" would that be the market value based on comps in my area? Or how would that be determined? The median sell price of homes in my area has shot up quite a bit in the last 3.5 years since I bought that house. Does the bank send out an appraiser to determine how much they would allow me to refi for?

I need to do more research on helocs, but since I don't have a ton of equity in that house, I assume I wouldn't get much out of a heloc, but maybe you can help me understand what that would look like? (Purchase price was 92k, I put 5% down, so loan amount was $87,400. I still owe right around $80k. BUT when I bought the house the appraisal came back at $100k. Not sure if that is a factor or not.) Thanks so much for the help!

Thanks @Stephanie P.!

I'm still trying to familiarize myself with how portfolio loans and refinancing work. I've heard that portfolio loans would normally come from smaller local banks or credit union. Is that right?

This particular property is a cash only deal, so I would need the full amount of purchase price + rehab in hand(approx 85k). So if I got all of that money from my investors and did the rehab, would I then just "buy it from myself" with a conventional loan to pay back my investors? If the most I could get from the bank is $93,750, then I would have just enough to pay back my investors and could then go on using the property as a rental. Is that what you were getting at? Thanks so much for the response!

@Dan Gamache

If I were to put my old house in the market, I think I could get $130k pretty easily. Not sure if it would be a good idea to refi for that mich, though...

The new house is currently at $115k.

I’m looking at a property in my neighborhood that is turnkey and just dropped down to $115k. I don’t have cash for a 20% down payment, but I was considering doing a cash out refi on my first home (which is already a rental property.) I don’t know much about cash-out refi’s, so let me explain what I think I want to to do, and you all can tell me how misguided I am! Haha

I owe $80k out of the original purchase price of $92k on my first house, but I think I could easily refi for $110k-$120k. The result would hopefully give me enough cash in hand to put 20% on the new property and cover closing costs. Would this be a good way to acquire my 2nd rental?

I appreciate any feedback!

Hey there, I’m relatively new to BP and this is my first post! I’m interested in doing a flip (or multiple flips) to fund more buy and holds. I currently own 1 rental property, but am hoping to expand to 5+ in the next couple years.

Since I am low on capital of my own, I’m planning on bringing on private investors to fund any flips that I do and I wanted to put some numbers up to get some help with analytics. I want to make sure I’m not missing anything important. I also have some questions about taxes and exit strategies. I'll post my spreadsheet at the bottom. Here are all of the questions I have at the moment.

1) If I complete this flip within a year, is capital gains tax a concern? Or will I just have to pay my regular income tax rate on the profits?

2) The only 2 exit strategies that I am aware of are selling the property for enough to cover my investors, or refinancing the property myself and holding it as a rental. What are some other exit strategies?

3) How does refinancing work in this situation? I would have purchased the property in cash using my investors capital...would I then refinance and be able to use the profits to cover my investors AND my down payment on the mortgage?

Here is my analysis with rough estimates on the rehab costs...