Would LOVE to shadow and learn from a seasoned investor.

Question

I am new to real estate investing. I am based just outside of the Washington, DC metro area and would love to shadow a seasoned investor to learn as much as possible. I can clean vacant properties, or whatever is needed. I am just eager and ready to learn.

Thomas Baylor · Answer

@Matt M. I am just starting out so all of this information is awesome, thank you.

Matt M. · Answer

@Thomas Baylor

As far as I know, typical refi is 75-80% of the appraised value. So if the property is worth $250k, 80% is only $200k. You are paying $190k. After a few thousand in closing costs, there’s only a couple thousand left, literally. If the property after rehab is worth $300k, you could pull out maybe $30-40k. But otherwise it’s pointless to refi.

Thomas Baylor · Answer

@Marian Huish thank you for taking the time to reply! Yes I have, but still need to run some comps around the area. No I do want to manage myself because I am looking to move in the next two years to Texas so I would like to eventually hire a property manager.

Thomas Baylor · Answer

@Matt M. Thanks for taking the time to reply. So you’re pretty much saying there would be no point in refinancing if I’m already buying below market price? I still have a lot of homework to do. I have not gotten an appraisal yet so I’m not sure how much it would be worth after 10-15k worth of work is done.

Marian Huish · Answer

Have you determined what kind of rental income to expect after rehab?   yol want to be sure it’s worthwhile… Would you be managing it yourself?

Matt M. · Answer

@Thomas Baylor

I’m not sure how you’d refi, if it’s worth $250 and you are paying $190. 80% of 250 is 200. Add in closing costs and you are left with pennies. What would it be worth after you’ve put $10-15k into it?

Aaron K. · Answer

Appraisal should come after the rehab when you are looking to pull money out in the refi, you'll need the quote eventually but I'd wait until you are ready to start rehab, get multiple bids and pick one once you have all bids, because it seems like you'll be doing the rehab regardless of whether you refinance or not.

Thomas Baylor · Answer

@Aaron K. I believe the property is worth nearly 250k. Would you recommend getting a contractor in to see what all needs to be renovated first that way I have an estimate? And when should I look to get an appraisal?

Thomas Baylor · Answer

@Neil Narayan Appreciate that! Will do.

Aaron K. · Answer

@Thomas Baylor sounds like you are on a good track, given I don't know how much the property is worth I can't comment on the feasibility of a cash out refi to purchase more property but even the first one is a good start.