My first rehab turned cash flow GOLD!

31 Replies

I want to first thank everybody on this forum that helped me get through some of the learning curves that I had to deal with to finally close my first deal. 

A Month ago I picked up a property that was in foreclosure for $95,000. I use a hard money lender thatcwould fund 100% of my purchase price and 100% of my rehab cost. I had budgeted $20,000 for repairs within ARV of 165,000. During the process we definitely had some curveballs but was able to keep my rehab cost under $20,000 and the house turned out wonderfully.

 Once I close on the property I listed it for rent for $1600. I collected numerous applications, met with potential renters, and finally found the best renter for the property.  I was able to  to get a rent amount of $1650 and a tenant the plans on staying in the home at least three years because they don't want to move their three children. 

I recently submitted my application to refinance the property out of the hard money lender and it should close sometime this month. After the property is refinanced my PITI will be $940 netting me $710 a month and cash flow from this one property.

 I've watched and seen other people do this every day, but drug my feet till I found this site and a great mentor that I lean on a ton.   I'd really like to mention his name but don't think he'd appreciate the bombardment of private messages. LOL. 

 I'm currently working deals on two properties that I'm trying to wrap up and put under contract hopefully by early next week.  If I can land both of these properties diesel again be some really good cash flowing opportunities and one more step closer to getting out of the rat race. 

 I hope this post motivates someone the same way that I was motivated and gives someone the extra push like it gave me. 

wow nick congratulations! that very exciting and does inspire, I am new to biggerpockets just created by account and seeing a success story like yours first thing is very motivating. 

Good luck on your up coming deals.

Awesome story @Nick Versetto !! At first, when I was reading your post I was thinking it was for a flip. But to see you got a 100% HML and turned it into a rental, that's amazing! Right now I'm looking for a flip but eventually want to do exactly what you did and increase my monthly cash flow with some rentals.

Good job.   Photos!

Great job. Curious where you found investor for 100% of purchase and renovation ? What were terms (points/interest rate etc)

I would very much appreciate if you are able to give me the name of that party that gave you 100% of purchase and renovation and the terms you got? You can PM by email.

@Nick Versetto congratulations!  Sounds like you made a great choice on the property to buy, rehab and rent.  I think you're well on your way to escaping the rat race. Now you just have to watch out for the rats in the RE world.  :-)

Originally posted by @Nick Versetto :

I want to first thank everybody on this forum that helped me get through some of the learning curves that I had to deal with to finally close my first deal. 

A Month ago I picked up a property that was in foreclosure for $95,000. I use a hard money lender thatcwould fund 100% of my purchase price and 100% of my rehab cost. I had budgeted $20,000 for repairs within ARV of 165,000. During the process we definitely had some curveballs but was able to keep my rehab cost under $20,000 and the house turned out wonderfully.

 Once I close on the property I listed it for rent for $1600. I collected numerous applications, met with potential renters, and finally found the best renter for the property.  I was able to  to get a rent amount of $1650 and a tenant the plans on staying in the home at least three years because they don't want to move their three children. 

I recently submitted my application to refinance the property out of the hard money lender and it should close sometime this month. After the property is refinanced my PITI will be $940 netting me $710 a month and cash flow from this one property.

 I've watched and seen other people do this every day, but drug my feet till I found this site and a great mentor that I lean on a ton.   I'd really like to mention his name but don't think he'd appreciate the bombardment of private messages. LOL. 

 I'm currently working deals on two properties that I'm trying to wrap up and put under contract hopefully by early next week.  If I can land both of these properties diesel again be some really good cash flowing opportunities and one more step closer to getting out of the rat race. 

 I hope this post motivates someone the same way that I was motivated and gives someone the extra push like it gave me. 

 Sounds like a great deal - hard to find something like this in the Seattle area.

Congrats! Rinse and repeat!
Nick Versetto nice job on this transaction. Keep it up! Any leads on the HML would be appreciated. PM if you have some helpful info.

Great job @Nick Versetto !  The most impressive part of this project to me is that you didn't seem to go over budget on your first project.  That happens to almost everyone on their first deal.

The other guy that is the winner in this situation is your HML! Looks like he is going to be getting some warm leads or at least a bunch of tire kickers.

Michael Noto, Real Estate Agent in CT (#RES.0799665)
860-384-7570

@Nick Versetto

Congratulations on your real estate venture success! You do motivate newbies, like me,who are still learning the ropes in real estate. I hope I can find that first deal.

quadruple check your numbers and leave a nice cushion in case something happens once you open the house up and start work.  My hml that I found is only in the Chicago market.  My best advice is to continue networking with the lenders on this site and check the marketplace ads.  

@Nick Versetto ,

Alright Nick ! good going. You were smart to turn it around into a buy and hold. Should give you a nice add to your monthly income. Great Job !! just go for it bro. Now just do 10 more just like this one. 

@Brie Schmidt was a huge help!  She introduced me to mint.com and a great conventional lender. Lol

Dude that's an awesome story. I'm so glad to hear that you successfully pulled off that first deal and already started working on new ones. Those numbers are great and I bet you also learned a ton in the process. Congrats and keep up the good work!

thank you @Vincent Crane I learned a ton and can't wait for the next one.  One thing I've noticed is you have to have an open mind and not be stubborn as you're learning.  

@Nick Versetto that's a great story, congrats!  Was the property in the South Suburbs or closer to the city? 

thanks @Chris Wienke south burbs. 

Fantastic project success. Congratulations and hope you have great success in you next projects. What an inspiration for those of us still trying to find our fist deal.

@Larry Smet thank you and it is a SFH. My focus is SFH for now and trying to grow a passive income portfolio. I honestly couldn't of done it without the people I met on this site.

Nice job. Don't forget to allocate money for property management (even if you are self managing for now), maintenance, vacancy, cap ex, etc. Cash flow is NOT = Rent - PITI

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