All Forum Posts by: Jonathan Newsome

@Mitch Messer I agree with you on not much cash flow and as silly as it sounds, it still IS generating a positive amount, although small. Now taking into consideration that this is a 15 year loan and not a 30 year, we can assume (hopefully), that going with a 30 year would net a slightly higher amount of cash per month. I do understand and completely agree with everything you're providing here. 

You know, this is exactly why I am posting here because honestly, I didn't even think to ask them about refi with another lender, I really appreciate you bringing that up! I'll definitely ask!

As for market rents for comps, they are $1000-$1100. it's a 3bd/1ba in a very nice and quiet neighborhood. It's approximately 20 minutes away from Fort Leonard Wood in MO. 

Again, I appreciate the valuable insight you're providing, thank you much!

@Patricia Steiner thank you for the information! I'm not too knowledgeable on listing the property with an agent and even less so listing as an "income property". How does this process work and what is my involvement in it? If you could share this with me, I'd greatly appreciate it! In the meantime I will look to BP search to find out more about this process. 

@Rachel H. Yea I can definitely look at talking with some property managers. And they are selling because they have a home loan with the 'VA' and since it is taking up a slot of theirs, they want it gone. They'd like to reuse the 'VA' home loan to build their 'dream home'. I agree with you on the repairs as well. Something that was mentioned in another post was that there will typically always be repairs after a tenant vacates the property. This is something I did not account for. Having said this, I can assume there WILL indeed be repairs, but I still feel as they may be minimal. I appreciate you listing some items that should be checked, in your previous message. This is all going to assist me in making the best decision for all parties, thanks!

@Mitch Messer Hello there and thank you for the welcome!

I was actually wondering if I should list that or not online? I suppose it doesn't do any harm. The seller's balance is approximately $98k. The current mortgage payment is roughly $850. With that being said, they are positively cash flowing. They only have a very small amount of equity in the property, close to 40%. The reason the mortgage payment is on the higher side is because they have a 15 yr loan. 

You make a great point in that there will be expenses when the current tenants move out, though I still think they will be quite low. I suppose we can only tell when they move out or by doing another inspection of the property. 

The seller has a VA home loan. They are trying to sell the property 1) because they no longer want to rent anymore, but mainly because 2) They want to free up that "VA slot" and use it to build their "dream home"...

The reason this seller may not opt for a Sub2 deal is because of the above statement of freeing up their VA loan slot. Please correct me if I'm wrong, but under a Sub2 deal, the mortgage remains in the seller's name. And so doing this will not allow the seller to take out another VA home loan.

Thank you again for responding and providing me with some information, I greatly welcome and appreciate any knowledge that can be shared!

@Rachel H. That's what I was kinda figuring. I believe the deal may not have a large enough spread either... I was posting/asking for $118k and the ARV is $156k, however there are no repairs necessary and it is currently cash flowing. With those current numbers, would you consider it to too skinny? And thank you for your quick response yesterday!

Hey BP!

Looking for ideas or suggestions with this deal. I'll jump right into the details now. Think I should of posted in this discussion to begin with, though I'm unsure. 

3bd/2ba SFH w/1,524 sq ft. built in 2004. Location: Waynesville, MO (20 min from Fort Leonard Wood)

The seller has remodeled the home, including but not limited to: a/c (1yr old), Floors (Pargo), Stain Resist. Carpets, Ceramic tile, remodeled bathroom (sinks, showers, fixtures), and new paint. No repairs needed at this time or IF any, Repair/upgrade cost would be less than $5k.

The good: Home ARV is approximately $156k. It's a turn-key property. Current tenants paying $1,100 mo and will be moving out in Sept. (lease up). Property is currently cash flowing approximately $250 on a 15 yr amortization loan. 

The not so good: Seller has low equity in the property, so there's still a decent loan balance left. Seller is motivated, however want to get rid of the mortgage under their name (sub-to out of the question). They've tried listing it a few times in the past, but no luck selling.

The properties don't sell too quickly in that area, however they rent like hot cakes!

I'm looking for any suggestions/ideas to help this seller out. 

Hey BP! 

Looking for ideas or suggestions with this deal. I'll jump right into the details now. 

3bd/2ba SFH w/1,524 sq ft. built in 2004. Location: Waynesville, MO (20 min from Fort Leonard Wood)

The seller has remodeled the home, including but not limited to: a/c (1yr old), Floors (Pargo), Stain Resist. Carpets, Ceramic tile, remodeled bathroom (sinks, showers, fixtures), and new paint. No repairs needed at this time. 

The good: Home ARV is approximately $156k. It's a turn-key property. Current tenants paying $1,100 mo and will be moving out in Sept. (lease up).

The not so good: Seller has low equity in the property, so there's still a decent loan balance left. That being said, they did originally opt for a 15yr amortization with their lender... Seller is motivated, however want to get rid of the mortgage under their name (sub-to out of the question). They've tried listing it a few times in the past, but no luck selling. 

The properties don't sell too quickly in that area, however they rent like hot cakes! 

I'm looking for any suggestions/ideas to help this seller out. 

First off thank you for the opportunity to introduce myself. My name is Jonathan, though I usually go by ‘Jon'. I started listening to BP podcast a few weeks ago and haven't stopped since. I've watched the YouTube vids, read the books and listened to multiple podcasts, though I wouldn't say any of that makes me an expert. I've also just recently started up my business, forming it into an LLC. I'd like to think I now have a solid beginning-foundation and novice-level ‘know-how' of wholesaling Real Estate. I'm familiar with terminology and some applications/software. With that being said, I'm a new wholesaler servicing the Richmond/Chesterfield/Mechanicsville and surrounding area(s). I've been doing a lot of driving for dollars and some cold calling leads, but no luck yet. This motivates me to try harder, I am very persistent and goal driven. I'm very open to hearing new ideas and ways from the experienced and non-experienced. My preferred method in wholesaling is ‘assignment of contract', though I would not be opposed to a ‘double-close'. Thank you all and I look forward to hearing about your successes, experiences, and stories in Real Estate Investing.

@Ericka Chatman I second that book! I purchased the audible book and I have to say he did a great job of breaking things down and explaining the process. Be sure to take lots of notes!