Here are the #s from the BP property estimator.Purchase Closing Costs$3,500.00Estimated Repairs$0.00Total Project Cost$248,500.00After Repair Value$245,000.00Down Payment$8,575.00Loan Amount$236,425.00Loan Points$4,728.50Amortized Over30 yearsLoan Interest Rate4.375%Monthly P&I$1,180.44Total Cash Needed$16,803.50 $2,900.00 MONTHLY INCOME$2,468.77 MONTHLY EXPENSES$431.23 MONTHLY CASHFLOW7.89% PRO FORMA CAP$19,340.00 NOI$16,803.50 TOTAL CASH NEEDED30.80% CASH ON CASH ROI7.89% PURCHASE CAP RATEI assumed I'll do an FHA loan at 3.5% (or maybe 5%) and would pay closing costs out of pocket.

I just got the inspection report for the house and it says that the roof needs to replaced or repaired (see attached pic).

I’d put it under contract and assume a certain amount of money to repair.

I'm averaging at least 1 call per week to make minor repairs (admittedly these are things that need to be repaired).

I purchased a second rental property in 2017 and it was not in service for about 4 months while repairs were done.

I believe this model has saved me tens of thousands of dollars in repairs from disgruntled tenants, and also has saved me so much money in turn over costs.

A recommendation would be to start setting some money aside now to build up your repairs/CapEx fund and then whatever extra you get from the rent, put it away for future repairs. 

All of this was well over the property's market value at any given time in history.Then everything was refinanced into one $3.2 million loan by a small local bank, which the owner promptly defaulted on.

THE QUESTIONS:Should Johnny get a hard money loan to purchase the home and make repairs, then re-fi 6months later to access the equity and invest?

If I was to put an offer in I was thinking about offering them half of the asking price because it needs roughly $30000 in repairs and updates to make it competitive (based on many other places being modernized).