All Forum Posts by: Ben Roberts

@David de Luna

I’ve heard of lending club, but their rates are higher than a cash advance on my credit cards. What is Marcus? Can you borrow money from PayPal?

I normally wholesale in Memphis, TN but I've come across a rental that I'd like to own. The property is currently rented for $660/mo, I can buy it for $22,000. It definitely needs some updating and the market rents are closer to $825. The ARV is in the mid $50's. I have a little bit of cash, certainly enough to cover the updates, closing costs, etc. But I don't have enough for the full purchase price. I doubt a traditional mortgage is going to work at this price point. Does anyone have any suggestions, references, recommendations?

Thanks in advance!

@Randall Weatherall Holy crap!  Are you serious?

@Dean Harris

Thanks!

@Derrick Craig, Thanks.  I'll go take another look at everything.  

@James Martin Can you tell me a little more about why?  This house is just a few blocks south of Winchester, between Ridgeway/Hickory Hill and Mendenhall.  From what I understand it's a pretty solid rental neighborhood.  Looking at other rentals within a few blocks, I think $850-900 per unit is a fair price. Especially once we do a little updating.  

@Ryan Blake

Thanks. That all makes sense. I think my best case scenario is buying, repairing, renting, and then selling.

$140k for a rehabbed property renting for $1,800 seems like a pretty solid deal for another investor. It's $140k ARV that has me nervous.

@Ola Dantis

In this case, I'm using a HELOC to help fund the deal and I want to pay the HELOC back. So, from my perspective, a buy and hold with the worst case financing, pays the HELOC back over the course of 20yrs and leaves me $90/mo. That leaves me exposed to credit risk. I'd MUCH rather sell the asset, pay back the HELOC, put a few grand in my pocket and look for the next deal.

@Ryan Blake

Yes, the property would cash flow like crazy, even after mgmt, repairs, capex, Vacancy, AFTER refinancing. I am moderately worried that my ARV is off meaning I may not be able to refinance.

Is that a reasonable concern?

It's a duplex with few comps, so ARV of $140 is based on avg sales price per sq ft. I had a realtor tell me that the property is worth $125k in its current state but that feels a bit high. I should probably reach out to a few local folks for a second opinion on the ARV.

@Dennis M.

That would be absolute worst case. I don’t believe it’s very likely but I am trying to run through every possible scenario.