Below is a rehab I just closed. This was a great deal for myself, my lender, and my private investor. It was a rehab in a hot market in East Nashville.

1. How I found it - Like many of my deals, I found this one via direct mail. It is my number one strategy of finding deals. But this one has a little better of a story. Most people will say mail a list 4-6 times and go to the next list. If I would have done that, I would've missed out on this deal! He called me on the 12th letter I sent to this man. It was from driving for dollars in an area I like. The seller calls me and says "I called you first because no one else has sent me more than 4 letters, so I figured you were serious." I drove by the property, gave the guy a call back and he jumped at my first offer of 160,000 (should've offered less!!!!)

2. How I funded it - I did not have ANY money to do this deal, but I was determined to not let this one go by. I quickly called a hard money lender. He was willing to give me 70% of the money I needed at 13% and 2 points. I obviously did not have the 30% down he was looking for. And keep in mind I could not go to a bank for any of this, I was still not bankable at the time. I called an investor I met at the local REIA and she offered to give me the 20% I needed and some and she would get 20% of the deal. I agreed

3. The Numbers - 

• Purchase - 160,000
• closing costs - 5,000 (I had to pay points)
• Rehab estimate - 80,000 (It ended up being about 93,000)
• Holding Costs - 7,200
• ARV was 350,000
• timeline took 5 months from purchase to sale

So I borrowed 150,000 from the hard money lender. And the private investor brought in the remaining 100,000 from a private investor.

We ended up selling the house at the end of the project for 375,000 (yes the market had appreciated and I personally think we underlisted but I would rather do that and sell quickly!)

We incurred 27,700 in closing costs (includes realtor's commissions. Yes I am a realtor and I sold the deal but I never include that in net profit and neither should you)

Our net profit ended up being 79,899.76

My investor got 15,979.95

and I got 63,919.80 plus my listing commission

4. Lessons Learned

1. I hate basements - We had to finish the basement out to get the sqft needed on the resell. It was a pain to prevent water intrusion. Even though we dry locked, implemented a pipe drain, new drywall, etc. we still had water intrusion in one corner we had to fix on inspection. Basements are also really expensive to renovate. I personally do not think I will go after another house with a basement UNLESS the deal is great.
2. Radon is a thing that realtors care about now. We are going to test for radon on every house we get now. I would rather prevent that problem up front.
3. decks and community spaces are a must feature in every house. We made the decision to add two decks off the back and the buyers absolutely loved it
4. and parking is a necessity. We decided to add parking in the back off the alley. The city was grateful we pulled cars off of the street and so were the neighbors!!

To see the finished product, it is MLS # 1730639 in Nashville TN

Everything went smoothly on this deal, we did not have that many hiccups. I wish I had a horror story but sometimes the deal just works out the way you want it to!!