The Strategy Game

[Andrew Terry]

Trying to figure out my strategy beyond the first property. Let me here what you would do with the scenario.

Purchase Price:40K

Rehab: 40K

Total Loan From Lender after Rehab: 80K

ARV: 130K

Fair Market Rent: 1,200 Mo.

If this was your very first purchase, with a goal of wanting to scale, and build a portfolio based around LTR, and Fix and Flips. What would your strategy be, using only the finances provided above. 

Extra Points for Oklahoma Market

[Jake Baker]

@Andrew Terry

Rehab of 40k seems kind of light. Is this just a cosmetic rehab? 

If this your first, a flip may be a viable option so you can build up some reserves. 

With cash you can make higher margins per deal because you have less holding costs.

With hard money you can make a better ROI because you are putting less of your own money in the deal. Think ROI… Your return is lower, but your investment is much lower.

Why I use Hard Money:

1. Higher ROI on my Money
2. I can keep more of my own cash in reserves in case something goes sideways.
3. A good HML will be on your side. Another pair of eyes to look at your deal.
4. Leveraging debt allows me to do more deals.