All Forum Posts by: Beau Ryan

I would go to a local or regional bank. Come prepared with all the numbers that make the deal work. Show them contractor estimates and time frames. Show them the comps you are comparing it with. Lay it all out for them. With 20% down and decent credit you should have no prob.

Def don't worry about asbestos siding if vinyl is covering it and you don't have to remove any of it. I would consider putting 20% down to avoid mortgage insurance instead of the 15% you mentioned. Property taxes more than likely won't decrease if this is a distressed sale. Don't plan on getting more than $600 rent if that is what your realtor is telling you. Especially if it is in a "c" type area. Rents will be pretty much the same and the ought your description or repairs it doesn't sound like you are doing much to separate your property from the others. Definitely plan to spend quite a bit more than $5000 if you aren't doing the work yourself. I would budget for double that. The mAterials won't cost a ton but the labor will add up. Also make sure that those rents don't include you Payjng for any of the utilities. Water, gas, electric, garbage, etc. I personally don't think this is a very good rental opportunity. Sounds like it might be better to flip. I would see if comps are selling around the mentioned assessed values of 50-70k or higher than you should be able to make some money fairly quickly if you can buy it and fix it for around 40k and sell it for 60k ish.

Being your first deal this home is your typically first time home bury type property being 3 bed 1 bath. Should sell pretty quickly if priced right. Make sure you are being conservative on your arv. Also I think your closing cost numbers are low. 6% realtor fees would be $6900 a lone based on a 115k sales price. Also being a first time home buyer type property you very well might be laying for 3% in buyers closing costs. I would also add 30-50% onto the estimated construction costs. These costs run high even for seasoned investors and unknowns almost always pop up. So I would ball park costs at 67k purchase. 10k closing and realtor fees. 20-25k construction costs. Prob looking more like 100 into it and hoping to sell it for 115. And then you are getting pretty thin. But if it is in a good neighborhood where things sell quickly it might be a good small home to start with. And doesn't look like you can lose money on the deal. I say go for it and get the experience. Maybe thi bds work out well and you do make 25+

I am an appraiser and investor. I would run the other way if your mentor is trying to get you to purchase a property 25k over the appraised value. You should be looking for something 25k under the appraised value. Also having long term renters in there that you plan to keep might very well cost you money as they are more then likely paying less than market rent. I would look for a better deal.

I would look into small community banks or regional banks. These banks can keep loans in house if they choose. Typically these lenders will loan on smaller amounts that the big banks won't and they are also more liberal on their lending standards. They may vary well loan as an owner occupied property if you tell them the situation. It helps to already have relationships when doing these kind of deals. It can't hurt to call a bunch of them and see if any one will work with you. I have had success with similar situations in the past with these types of lenders.

Columbia heights might be ok. Not the greatest area but not the worst. St Louis park is a great area but you won't find anything near the value of 75k you were talking about earlier.

It seems to me that you are giving up 50% equity for no reason. If you just borrow 12kish from the relative you will have 25% to put down on a conventional loan to purchase property yourself. If you are buying it with no fix up costs needed and below market value than you should be good to go. Use the cash flow to pay off the borrowed money over the next couple years.

I am an appraiser myself. I personally think it would be a waste of time and money to take appraisal courses. I think you would be much better off finding a local appraiser in your market and offer to buy him lunch and have him explain how he goes about valuing properties. I think it is very important to understand as the appraised value maybe much different than what a realtor may value a property based on their market analysis or what the county values for their tax assessments. The appraised value is very important in most cases when selling to people who will be borrowing money from a bank as that is the main criteria they will use to decide how much to lend. I have seen many many deals fall apart because the purchase price ended up being higher than the appraised price. I would be happy to answer any general questions you may have although many things differ based on markets.

Hi I am new to bp. I have been listening to the podcasts for a while but have just started exploring the website. I currently live in chanhassen but own rentals and have a few flips going in the rochester area. I am also a real estate appraiser encompassing the areas of the southern metro down to mankato and over to rochester. I would be interested in meeting up with fellow investors whether it be in the metro or northfield owatonna or anywhere else Inbetween as I am regularly driving through those areas already. I look forward to meeting others interested in real estate investing.