Using an Assumption to Buy and Hold SFR in Las Vegas

[Robert Adams]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $377,000

Purchased this using a VA assumption. Allowed us to get into the home with a 4.1% rate, very little out of pocket (roughly $10k) and shave off 3 years of the loan term.

We spent about $12k doing repairs, upgrades, like exterior paint new roof for the covered patio and fix some tiles, clean up the landscaping, several minor repairs, etc.

We now have break even cashflow with very little out of pocket. We were also able to use a cost segregation report and get $121k in depreciation. The cost seg alone paid for the cash out of pocket. The photos are from before any repairs or upgrades.

What made you interested in investing in this type of deal?

The assumption terms were very favorable.

How did you find this deal and how did you negotiate it?

This was a VA listing. The listing was not selling. We proposed a creative deal where we assume the loan. The seller was in agreement. It became a win win. We paid all the seller's closing costs, charged no commissions, and took over the loan. We also bought it As-Is no it was very convenient for the seller.

How did you finance this deal?

Small out of pocket expense covering both sides closing costs, and doing some repairs. The rest was the assumed VA loan.

How did you add value to the deal?

Some repairs and upgrades prior to renting it out.

What was the outcome?

Successful purchase and it is now rented out for break even cashflow.