Sold my first rehab-

29 Replies

Alright...that is all done and I can move on...phew..
So heres how the deal broke down.
I paid 162K for the property
Spent 33K on the rehab which took 8 weeks.
Closing, holding, and closing again cost a total of 16K.
The property was on the market for about 3 weeks until I received a full price offer of 264K.
The realtors got almost 15K.
So my end of the day pure profit ended up at 38K.
In retrospect, the deal was a little weak to begin with and my estimates were completely out of whack ( I estimated 12k on rehab and had comps of 230 - at least one blunder saved me from the other). But for a first timer...not bad. Now had I known then what I know now...I would have paid less for the property to begin with. I was pretty desperate for my first deal, and didnt realize the extent of my sellers motivation. I really could have got it for less.
Hey - next time I'm the wiser.
38k is still 38k. I'm happy.

Congrats on that deal! For a first time you did very well. As you learn more your deals will get better. My first deal was a total disaster, anything that could go wrong did and some things that couldn’t go wrong did as well. I was in so far over my head, the only thing that saved me was that I was living in the house. If it had been a pure rehab deal meant to be flipped quickly for a profit I would have been toast. It worked out great in the end because I bought it cheaply in a market that was rapidly appreciating. The appreciation saved me from the other blunders. What I learned was priceless, I could not have paid for the experience that I received. Hopefully this will be the same for you. Can’t wait to hear about your next project!

8)

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....................................CONGRATULATIONS!.........................................

:lol: :mrgreen: :lol: :mrgreen: :lol: :mrgreen: :lol: :mrgreen: :lol: :mrgreen: :lol: :mrgreen: :lol: :mrgreen: :lol: :mrgreen: :lol: :mrgreen:

Congrats, Minna. I'm sure the other details are buried in posts elsewhere, but I am wondering how you funded the purchase, rehab, etc. and at what points/rate if it was HML. How was it working with the lender, if it was financed?

Thanks!

I took out a 100% bank loan (stated income 75/25, 8%, 12%, interest only, no prepay penalties, as I recall I did pay 2 points) to purchase the property, and I took out a heloc on my own house to fund the rehab and holding costs. I didn't really have any spare cash hanging around. Just equity.
Actually I got lucky there too, since I bought my own house just last year with nothing down, and the only reason I had any equity was that it was a neglected preforeclosure that I just happened to run into at the right time and jumped on it - hence the equity.

Originally posted by "Minna":
I took out a 100% bank loan (stated income 75/25, 8%, 12%, interest only, no prepay penalties, as I recall I did pay 2 points) to purchase the property, and I took out a heloc on my own house to fund the rehab and holding costs. I didn't really have any spare cash hanging around. Just equity.
Actually I got lucky there too, since I bought my own house just last year with nothing down, and the only reason I had any equity was that it was a neglected preforeclosure that I just happened to run into at the right time and jumped on it - hence the equity.

Minna,

Can you say where you found a lender willing to provide this type of funding?

Thanks

I use colorado federal savings - www.cofedbank.com (no affiliation) for almost all my re purchases. My guy there always beats out everyone else I talk to. As long as you have good credit, you can pretty much get whatever loan you need. No rehab loans there though. PM me if youd like my guys contact info. He's incredible - gets anything done.

Originally posted by "Minna":
Alright...that is all done and I can move on...phew..
So heres how the deal broke down.
I paid 162K for the property
Spent 33K on the rehab which took 8 weeks.
Closing, holding, and closing again cost a total of 16K.
The property was on the market for about 3 weeks until I received a full price offer of 264K.
The realtors got almost 15K.
So my end of the day pure profit ended up at 38K.
In retrospect, the deal was a little weak to begin with and my estimates were completely out of whack ( I estimated 12k on rehab and had comps of 230 - at least one blunder saved me from the other). But for a first timer...not bad. Now had I known then what I know now...I would have paid less for the property to begin with. I was pretty desperate for my first deal, and didnt realize the extent of my sellers motivation. I really could have got it for less.
Hey - next time I'm the wiser.
38k is still 38k. I'm happy.

I am new to this site and noticed your comments about the rehab. I did very well. How did they take you to rehab.?

Thanks.

Great news Minna! Congrats! I have been watching your ups and downs from afar, extremely antsy to get into a rehab myself. I had a closing fall through, my lender flake out on me, and I got a bit discouraged after that. Seeing your update gives me a bit of a boost. Thanks!

I'll PM you about your lenders info.

Nice work! It's great to have success on your first rehab/flip.

How did you find/locate your property? Do you think it was worth the work? What are you going to change for the next project?

The owners responded to my ad. They were an older couple and could not keep up with the house anymore (which looked like crap), were stuck with a 29 yr old son they didnt have the guts to toss out and had already bought a small trailer for themsleves.
I thought it was well worth it. I enjoyed it. But next time I'll have a more accurate budget and timeline going in.

In the newspaper. I advertise there, on signs, flyers, I mail to preforeclosures, look for vacant property, check listings, cold call...Leads arent knocking down my door or anything, but the most successfull methods for me so far have been the newspaper ad, and just starting conversations with people (ie neighbors of absentees, landlords in the area, friends/family who after knowing what I do, start keeping their eyes/ears open on my behalf)