All Forum Posts by: Adam Kent

Derrick. I have been searching for my first flip in Indianapolis for around a month. I have been looking downtown around popular areas like Mass Ave. Fountain square, woodruff place, and in the 46205 zip code. You may have a couple months before your flip is completed in these areas. You can add tremendous value to properties downtown that will require a lot of time and work. I have a couple of rentals on the southside suburbs that have incredible cash flow. I'm looking downtown at flips because what I have found is that downtown offers better ROI on flips vs buy and hold downtown.

honestly pick up the phone and stop in on some bankers. Interview the bankers while you on the phone or in person. Tell them about your plans.  It may turn into something or maybe not. 

I have developed a few really good relationships with some banks.

I made a great contact within a Credit Union and one with Fairway mortgage.  Just some examples.

Mary, do you having any connections that can estimate REHAB cost or ARV for you? It's sounds like there is a lot or research to be completed on the property. Ask the wholesaler what he thinks the REHAB cost and ARV are. Use on of BP's analysis tools to help you ask the right questions and evaluate the deal as well.

Originally posted by @Ezra Nugroho:

Hi BPers,

Generally it is well accepted maxim in BP that any buy and hold investors should have a reasonable amount of reserve for our properties just in case something goes wrong. 

With that in mind, wouldn't buying rental with no/little money down be too risky as well? BP has now published a book on this. I haven't gotten it yet, so I cannot tell if the book covers the risk mitigation for this strategy. I can understand how a flip may work well between a sweat partner and a money partner. But for a buy and hold? 

Ezra, this is how a evaluate deals. For my buy and hold deals I am looking for positive cash flow on the property. When I run the numbers I just assume I took at a 30 year mortgage on the property. I use I spreadsheet I created. Also check out the BP analysis tools.  This is a valuation of the property. I put at least 20% down though. I am looking to have all of properties paid for quickly. I would hold cash reserves. Know the cost of HVAC, water heater, plumbing repairs, etc. In your area to figure out what you need to have in reserves.

For a flip no money down is quite fine, just make sure you factor in your holding cost in your analysis of your flip. I am working on my first flip and I am taking the approach of over estimating rehab and holding cost to give myself a cushion on my reserves.

I would continue to live in it until you can raise the rent. Then I think more about moving out and renting the 3rd unit.  I am about positive cash flow on property.

Get a credit card with a low limit on it. You don't need a serious amount of debt to improve your credit score.  Pay your bills in full each month and monitor your score every so often. Don't forget applying for multiple lines a credit in a short amount of time will lower your score.

I love the Dave Ramsey plan of not needing a credit score and paying all cash. I am working on that myself.

Stay active on the forums and don't be afraid to make small mistakes. You'll learn valuable lessons. 

I charge a min of $1000. Some of my rents are greater than $1000 so in these cases I charge one month rent. I also have a property that rents for less than $1000.  I use the amount I charge for a security deposit as part of my tenant screening process.

it's really up to you to determine what you consider a return (Gain) and what you determine cost. When I calculate my ROI, I include my down payment in my ROI. Download one of the BP analysis tools, and plug in some numbers and see what makes sense to you.

Citi Double Cash.  You get 1% on purchases and 1% on payments.

Also I have a Wells Fargo card that pays on my mortgage. 

Welcome to the game.  My advice just get busy learning many aspects of investing a see what fits you.  I would reach out to some PM's and set up some meetings or even spend some time at there place of business.  You might want to connect with Josh Lawrence. He is one of my connections and is a young guy like yourself. He is running a PM company in Michigan.