All Forum Posts by: Ben Wernert

Thanks Mike.  I will DM you on the next.

Hey BP!!! Hope all are well!!!

I just wrapped up my first BRRRR deal and pulled all but some closing costs back out. I've got a local lender that I've had a long term relationship with so for me it was an easy choice to get my first deal done, however they do a max of 25years, and a 5% rate on a SFH. I'm also working on a portfolio type loan with them for future purchases, however based on the current rates I know I am leaving a little cash flow on the table with the cut in the term, and the rate slightly higher. I'm not in it solely for the cash flow as I work full time however I've done the math and in a 10 year period the cash flow seems to add up faster than the equity / pay down will based on what I can come up with. If my math is incorrect please let me know....I am perfectly fine with being proven wrong. Also this lender considers it a commercial property so when I guaranteed the loan for my LLC it does not show on my personal credit (which is what I want).

I'm also looking long term at closing costs....those things add up!  It took 2 closings in this deal

1. At purchase I paid cash so there was $800 in closing costs

2. I financed and pulled my cash out and paid an additional $1700 in closing costs

3. When / If there are secondary lenders for LLC / commercial loans (that do not hit my credit) there will be I'm assuming another 2k after the "seasoning" period.

So now I'm $5500 in closing cost alone....

My thoughts are if my lenders will close fast enough for my sellers I can rid myself of the cash closing unless it's just a crazy good deal, but I would love any feed back on ways to move into a 30 year when I'm pulling my cash back out.

Also should I use the portfolio portion of the loan to acquire and slowly move them into 30 years?

Thanks everyone!!!

I currently have a no pet policy.  I had a potential tenant ask if this policy included a "bearded dragon"...small lizard that is kept in a tank.

Does anyone have any experience with pets of this nature?

I'm wondering if I should consider things like fish, lizards, etc.... differently than a traditional pet such as a cat / dog.

These types of pets can can easily be neglected and their tanks could smell (I HATE SMELL)...Am I overreacting on something this small?  A pet like this warrant an additional pet fee?  An additional deposit?

Also wondering from a legal stand point if this type of pet Is something I'm willing to consider, should I change my advertising as negotiable and have a list of acceptable / non acceptable pets?

By the way I am a dog person, just OCD clean...I just don't trust others to take care of their pets in one of my homes.

Thanks everyone!

Ben

HI everyone. This is my first post, and I'm a new Pro Member as of today! I am currently finishing my first deal (BRRR). It is a self funded deal all in at 110k. I will be pulling my cash back out in the next few weeks, and I've began searching for my next deal.

Once I finish the BRRR on my first deal, I will have the funds free again to start another project. My first deal came to me via networking...a gift to get my feet wet that I knew I could make work. After educating for the past 8 months I now have an acquisition strategy with direct mail / Adwords that I've just launched. I didn't set out to wholesale deals, but could end up in a situation that would require that if I can't fund it.

I have set what I think Is a very realistic goal of acquiring 9 more buy and holds by the end of 2020 for a total of 10 roof tops. Based on currently only having the funds to do 1 deal at a time, and the length of the BRRR process, I don't believe I can achieve my goal without another source of funding.

Other than owner financing (which I am looking for) Is hard money a good option for funding another project while one is already underway, or is there a better alternative that I'm not asking about with my local lenders? I have a few good lenders that are eager to help when I already own the property and it's time to pull my cash out, but when it comes to a quick purchase I don't have any takers on funding it up front with out the lengthy loan process, and the typical down payment no matter what the LTV is.

I'd appreciate any advice.

Ben

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $95,000
Cash invested: $15,000

2 BR / 1 Bath 1350sqft. all brick ranch. Full basement. The home is located in an up and coming area, and will generate a good rent.

What made you interested in investing in this type of deal?

I'm drawn to the BRRR method. You can build future net worth, by investing $0 out of your pocket.

How did you find this deal and how did you negotiate it?

I found this deal by networking. A long time friend who also invests turned me on to this property when it wouldn't work for what he was looking for.

How did you finance this deal?

Self funded. Use of personal cash, and borrowing against a few assets that I will pay off once BRRR'd.

How did you add value to the deal?

rehabbed bath, new kitchen, and created a large 3rd bedroom with an oversized closet to serve as a master. Updated fixtures, flooring, paint, a few windows, and general clean up inside / out.

What was the outcome?

All in for 110k, ARV 150k. Should generate positive Cash flow.

Lessons learned? Challenges?

I did this deal to get my feet wet. It initially wasn't the perfect deal, but it was an easier deal with regard to the rehab. I have a background in construction, so the rehab wasn't an issue. in the future I will know the direction I will move before I purchase. I took about 10 days after purchase to decide what my plans were with regard to the rehab.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

The deal came to me from an investor friend, who is also an agent. I believe he turned my on to this deal to shut me up...lol! I know he wants me to succeed, and I'm grateful he was willing to share this opportunity with me.