All Forum Posts by: Alex Saleeby

Welcome to BP Kristy Farmer . Galveston is a very nice place to be. Wish you well in your investing endeavors.

Jon Bachman all else being equal, I see BRRRR as more advantageous that just flipping for a number of reasons. You may not be able to pull 100% of the equity out of a BRRR property, but if done right, you should be able to pull you let investment out and possibly a little extra, after the seasoning period required by your lender. I suppose the seasoning requirement might be viewed as a disadvantage of BRRRR relative to flipping. In other words, you may be able to recover your cash quicker when flipping (before taxes). It all depends on your goals & objectives.

Patrick Sears you pose a good question. The answer seems to be in the analysis that you already provided. For a difference of $15-20k of additional rehab costs, it's well worth it to go all the way for a number of reasons: (a) an extra $20k on the new mortgage only adds $100/month to the payment (30yr am @5%), (b) a nice property will likely attract s better quality tenant, (c) you may be able to rent the house for a little more and offset the higher mortgage, (d) it is far easier and cheaper to get many repairs and improvements done is rather than when the property is occupied, and (e) doing the full rehab gives you more options for your exit strategy down the line.

Hello @Rachel Trimble. After the seasoning requirements of the lender you choose, you should be able to complete the cash-out refi and recover your investment, and then some, if the property does appraise at $190k. As far as the calculators you asked about, this site has very good calculators for you to use. You will need to use both the house flipping and rental property calculators. I don't know if one calculator that would help with the decision of flip vs. BRRRR. That really comes down to your investing strategies, goals, and tax implications.

The question is do you really want to max out the cash-out when you refinance? That's when you'd need to run your rental property analysis. If you were to keep this property, you might want to consider recovering only what you put into it, which is the $110k and retain a higher equity position (<60% LTV). There are a number of reasons for considering this option including risk management, debt service, cash flow, and net worth growth.

Hello @Tom Lacey. Good questions and discussion. I would add that one additional side benefit to LLC formation is the creation of a clear and written operating agreement between you and your close friend. Doing business with friends and family has some challenges. Having clarity on roles, responsibilities, and other aspects of the business that are important to the two of you would help reduce potential friction in the future.

Good luck to you both. 

Nice project with great cash flow. I'm curious about spread in the rental amounts. If all units are 2BR, why a spread of $225 across the three units?

Thanks for the inspiring story John Upperman and sharing the project pics. Congrats on your successful rehab.

Yes, of course. You may contact me any time. I'll go ahead and send you the meet-up link.

Jordan G. Welcome to BP. Always nice to see fellow SETX investors joining this community as well. Lots of great resources here for you to learn and connect with others. If you are interested in a local REIA, there is a good one that meets monthly for education and networking (No guru pitches). Many attendees are BP members as well. Next meet is on the 29th. Hope to see you there.

Hello @Gaddiel Garza. Have you checked out the HML's listed on this site?

https://www.biggerpockets.com/hardmoneylenders

Good luck with your investing pursuits