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Shannon Vanderweide
  • Investor
  • Sioux Falls, SD
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20
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My first unexpected BRRR!

Shannon Vanderweide
  • Investor
  • Sioux Falls, SD
Posted Dec 15 2017, 16:38

Hey BP community!

I apologize ahead of time for the awful photos and probably poor formatting of this post. I had no intentions of refinancing this property or ever posting about it so I took some very awful pictures for the before. The next house I'll pay a little more attention to the pictures. I also have no idea how to write one of these to make it seem interesting.. So here we go.. 

The Property...

  • The house is located in a C neighborhood. 
  • It is legally a 3 bedroom 2 bathroom with an additional 2 non legal bedrooms in the basement. 
  • Ranch style home with 2 stall detached and fenced backyard.

The Financing/Purchase..

  • Off the market deal - friend of a friend deal. 
  • 20% down on 30 year conventional at 4.75% interest. 

The Numbers..

  • Purchase Price $75,300
  • Down Payment $15,060
  • Closing Costs $857
  • Rehab Costs $5,865 (Actual)
  • Holding Costs $1,329 (Actual)
  • All In $23,111

The Refinance..

  • ARV: $126,000
  • 75% LTV: $94,500
  • Walked out of closing with a check for $26,275

In total I was able to pull out all of my initial funds and an additional $3,164! 

So anyone that is good with numbers is going to be very confused with how this added up.. So a few side notes for the particular people.. :) 

  1. Because I knew the seller I was able to have them to pay 100% of closing costs (minus inspections and appraisal) for a higher purchase price. I believe I negotiated that I would pay an additional $3k for the house if they pay all fees.
  2. Because the property was located in a C class neighborhood the city had a "rehab" program that was an interest free loan for replacement of the roof. I took advantage of this and when the refinance was done it was repaid at closing. 
  3. Most of the repairs was all "sweat equity". Lots of painting, cleaning (LOTS of cleaning), new carpeting, new gutters, garage door opener, some new doors, etc.
  4. My holding costs were very minimal because after purchasing the house, the seller rented it from me for almost 2 months. Repairs/cleaning took approximately 3 weeks (I work full time as well) and the management company was able to have it rented and moved in within 3 weeks! 

(Sorry, some of the photos refuse to rotate. Tilt your head and you will get the point. ;)  ) 

Can't wait to see how this next BRRR turns out!

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