The 90 Day Challenge

[Dan Holden]

Brandon issued an involuntary challenge, "How to Buy a Rental Property in the Next 90 Days". I'm taking him up on his unspoken challenge. You know, the one he didn't know he issued. Starting tomorrow 03-17-14 I will start my 90 days. Ending on 06-15-14.

Below is the video that Brandon posted on YouTube. I will be following his outline to the T, and hopefully he won't mind a few questions from me every now and then. Be sure to pick up a copy of his outline at Brandon Turner's Fileplace.

Within that time I will procure one rental property and create a passive cash flow. Step One will obviously be getting pre-approved by a bank or a credit union. That should be fun. It appears that tomorrow morning on Day 1 I will be contacting some Money Keepers and seeing if they want to share any. Stay tuned as I try to keep everyone updated everyday.

Now what I do need from everyone else that wants to help is to keep me on track. Hold me responsible. There should be a "punishment" if I don't succeed but I have no idea if I should have one and if so what it should be. I'm open to ideas and suggestions.

Thank you all in advance for your help / support / hate mail. :) Hopefully I won't get any of that unless it's to spur me on to do better and go faster.

[Jonathan Marcus]

Hi Dan,

With all due respect to Brandon, I would suggest put more focus on finding a great deal. From personal experience, every time I found a great deal it's easy to find the money to buy it. It is the deal that will bring the money.

For example you find a 4-plex with 2-beds each unit in Greenville, SC. Median rent in the area is $1k per unit. That's $48k per year GOI. If let's say expenses is 45% of GOI (including 5% to cover reserves & vacancy) this will give you $26,400 NOI ($2,200/month) If you pick it up for 10% CAP, your purchase price is $264k.

If you borrow 20% from a private lender ($52,800) and pay 10% interest/yr that would be $5,280 or $440/month (interest only payments)

The mortgage on $211,200@5% interest 30 yr. is $1,134./month. Your total debt service combined is $1,574. $2,200 - $1,574 = $626 net cash flow; $156.50 profit per unit per month.

If you get a deal under contract similar to this example, it will not be hard to find the money to finance it. Start going out there and looking at properties, calling FSBO, attending your local REIA in addition to working with Realtors.

When you walk in to a bank and say you have a property under contract, you're putting down 20% on a purchase price of $264k. They will leap at the chance to work with you.