Help with ideas on strategies

14 Replies

Ok, I'm gonna start asking questions.

2 years ago I rehabbed a house by bosse high school  (Washington and 41, east side of 41). 

700 sqft 2 bedroom 1 bath 

Repairs came to roughly $30k (strip to studs, all new everything plumbing/wiring/drywall/roof/windows/etc...)

Assessors site values it at $49k. Currently rents for $700/month. That's my comparitive house.

I can pickup a clone a block away on the same street for $7k but it will need the same extensive remodel.  I can definitely drive the remodel costs down to around  $20k.

Do I rent or flip? 

The 6 months I was working on the comp house, I paid attention to the quality of the neighborhood and even stayed late a few nights to get an honest feel for it.  It's a quiet street, unbelievably.

If I go for the flip, I would try to push it for $60k. I am thinking pay cash for the place, pull a loan for the rehab.

This site has given me so many ideas, and so many strategies it can be hard to narrow down what to do.

Is there any good websites to get home values from? I've read that you can't trust zillow to much, and neither the assessors site.

I've definitely been entertaining that strategy. But doesn't that require a 1 year seasoning before you refinance? Would it be faster to get a heloc?

Which would get me access to cash faster? I want to do at least 3 deals in my first year.

Originally posted by @Bill Kramer :

I've definitely been entertaining that strategy. But doesn't that require a 1 year seasoning before you refinance? Would it be faster to get a heloc?

Which would get me access to cash faster? I want to do at least 3 deals in my first year.

I am not sure if they would lend all the way in Evansville, but I have made contact with a bank in Vincennes, IN that will send an appraiser out oce renovations are complete and allow you to put a line of credit on a house at 65% LTV with no seasoning period. This can be transformed into a higher LTV once their 6 month seasoning period is up.

To me, this is a great strategy to do your first couple of deals as long as there is a high enough margin. There is also no limit on the number of lines you can have because they do not sell their loans or lines to Fannie Mae or Freddie Mac. Maybe there is a local bank in Evansville offering this kind of program? 

Have you tried Field and Main? They are very investor friendly. They will do a loan for purchase and renovations up to 80% LTV if your credit score is above 680. I don't remember if they had a down payment amount or not. Just some thoughts!

Good luck and happy investing!

Yes, I would be paying myself a wage. As well as use a few subcontractor. I have a great drywall guy, hvac guy, and electrician.

I had another opportunity presented to me today. My sister has a house free and clear off heidelbach and diamond she paid $40k cash for about 4 years ago. She has offered to give it to me to refi and be my first tenant. But you know what they say about family and business... so I'm gonna keep that as a plan c for now. 

I've been watching hours of video trying to get the pros and cons of each strategy. Building cash reserves in the first couple years is going to be the most important thing.

I'm not entirely sold on brrrr yet, but I am definitely leaning that way.

That house I'm talking about, is now in the hands of the city for a tax sale... 

I may have to get creative now, the clock is ticking faster than expected.

I'm trying to find a way to get that ARV. went to ERA website, typed in address and it shot back a range of 33k to 68k (excellent condition) which seems to agree with my initial assessment.

Outside of paying for an appraisal, how do I arrive at an ARV in a neighborhood that is chock full of rentals purchased in the 1990's? There simply are no comps nearby.

Sure, I remodeled a house 2 years ago to get max value but I was not privy to what it was appraised for as it is a rental and hasn't been sold. I know they paid $19k for it, but it's definitely worth more than that now.