Closing Rentals #13 and #14 Kansas City plus Updates

12 Replies

#13 is a buy/fix/rent project near 140th & 11th in Grandview south of Main St. 3/1/0 Bought for $35,000 cash deal the rehab estimate is $8500. It will rent for $825-850 and with rehab will hopefully appraise over $50,000 allowing recapture of most of my cash when I finance it at 75% LTV with my portfolio lender.

#14 is an interesting deal and the most expensive house I have bought so far. I got a two year lease commitment at $1400 plus first months rent plus security deposits paid to me before I even bought the house.  House was $90,000 and needs almost nothing, it's in a very nice part of Grandview just south of Harry Truman around 128th.   This house also has had top tier foundation stabilization, waterproofing, and main drain sheathing done to it, has recently new roof and mechanicals.  Fairly bombproof compared to what I am typically buying. The family plans to stay for several years and has signed two year lease to begin with.  They are getting keys day after I close (tomorrow) and have paid up until August.  I was fortunate to get into this deal which was as much about the people as the property, although I have confidence in the property also I think it's worth a good 15% more than what I paid.

Other Updates..

#12 had a deposit down the day after I closed on it.  The couple moved in Saturday at $900 a month for two years.  I spent $700 extra on the make ready to upgrade from buff/polish to a complete sand but it now has the most beautiful re-finished hardwood floors.  I also put a little sweat equity in this one with 20 hours of removing wallpaper and paint prep for four rooms and the hallway.

#11 was rented out at $865 in South Grandview last week. I also just finished my cash-out refinance on #11. It appraised for $6000 more than I had in it so I ended up with a good portion of my costs covered even with 75% LTV.

#8 Remodel is complete and the house looks great.  You may think this is BS but the Very First Showing after I listed it the tenant was gaga over the house and put her deposit down that day and committed to a Two Year Lease at $825.  I have about $45,000 into this house after the rehab and I just started the loan process to cash out, hopefully the house will appraise over $50,000 and I won't have much into it at all.

#6 - draining issue at house seems resolved, ended up getting a buddy to do some dirt work with a small (stand-on type) front end loader. I had to buy a new AC unit though.

#9 - added a 220v circuit for tenant dryer in garage

On a general note I'm starting to be enamored with buy cash/fix up/rent and finance back out business model.  If the appraised value is high enough I can end up with very little to no cash in the deal, making it theoretically possible to purchase an unlimited number of properties.

Hope everyone is doing well with their projects.

Cliff

debt is something that nobody ever thinks about until it's a problem........

Nice work Cliff!  As always, your progress is encouraging. 

Very encouraging to see you making such a nice progress. If you are not worried about debt and are ok with 'worst case scenario' i would say, keep going.

Good luck for future projects

@Cliff Harrison quick question regarding your buy/fix/finance strategy. How long are your lender's seasoning requirements prior to you being able to refinance at appraised value vs. purchase price?

Thanks,

Mitch

@Cliff Harrison

 This is very encouraging! I love Kansas City and the rentals are good. Are all your properties in KC?

I plan to increase my portolio in KC steadily in the next 2 years.

Thanks again

This post has been removed.

Originally posted by @Mitch Rice :

@Cliff Harrison quick question regarding your buy/fix/finance strategy. How long are your lender's seasoning requirements prior to you being able to refinance at appraised value vs. purchase price?

Thanks,

Mitch

 Hi Mitch - there is no waiting period if financing into their portfolio product.  I am doing it right after I get it leased (which is not a requirement either just for my own piece of mind).  This is with Arvest.

Originally posted by NA Onyido:

@Cliff Harrison

 This is very encouraging! I love Kansas City and the rentals are good. Are all your properties in KC?

I plan to increase my portolio in KC steadily in the next 2 years.

Thanks again

 Hi Ndy - all are in KC.  I have the benefit of living here so can't beat it.

$90k purchase price for $1,400/mo rent is amazing in the KC area. I'm most familiar with North KCMO area, but I haven't been seeing any properties under the 100k mark being able to rent for that much. Great finds!

Cliff, Would you mind sharing the name of the loan officer you work with at Arvest? I was recently rejected for having too many loans (5, 4-rentals and 1-primary residence) by a local bank in Kansas City. Unfortunately, this Lender did not have a portfolio option. I ask for your specific loan officer because it seems that some are not as knowledgeable about our business, and are not willing or interested in getting up to speed for a one-off investor. I currently have seven single-family rentals in Kansas City (three are free & clear), and I own portions of two apartment complexes totaling 210 units in Arizona. All 217 units are fully occupied and have significant cash-flow. The loan I was turned down for was $50,800! I have found other portfolio lenders, but you mentioned in one of your other posts that Arvest will do a 30-year amortization on portfolio loans. That is a amazing! Thanks for all of your posts! Josh

Originally posted by @Joshua Swindell :

Cliff, Would you mind sharing the name of the loan officer you work with at Arvest? I was recently rejected for having too many loans (5, 4-rentals and 1-primary residence) by a local bank in Kansas City. Unfortunately, this Lender did not have a portfolio option. I ask for your specific loan officer because it seems that some are not as knowledgeable about our business, and are not willing or interested in getting up to speed for a one-off investor. I currently have seven single-family rentals in Kansas City (three are free & clear), and I own portions of two apartment complexes totaling 210 units in Arizona. All 217 units are fully occupied and have significant cash-flow. The loan I was turned down for was $50,800! I have found other portfolio lenders, but you mentioned in one of your other posts that Arvest will do a 30-year amortization on portfolio loans. That is a amazing! Thanks for all of your posts! Josh

My Arvest loan officer is

ERIK KOLSETHVP, MORTGAGE LENDING MANAGER

6300 NALL AVE, MISSION KS., 66202

913-279-3347 (o) | 913-677-3584 (f)

[email protected] | NMLS #488985

They are 30 year amortization but on a 5 year ARM. Arvest Bank has been great to work with. They will give you conventional 30 year term up until 10 financed properties and then you can use their Portfolio Loan product. Tell Erik I sent you and that he should do my next loan with no origination fee. Good luck.

Thanks a lot Cliff! I will definitely let Erik know that you referred me. I will also make my loans contingent on you receiving your next one with no origination fee! :-)

Thanks again,

Josh

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