All Forum Posts by: Brandon Foard

Long time follower of this page and we’re ready to find our first real deal. 

We’re not exactly sure what avenue there is for this scenario, so we’re looking for any possible situation that you could suggest. 

We've located an off market property that we would love to purchase for STR and personal use vacation.

It's a 1/1 located in the north Broken Bow area and after talking to a couple of STR investors and a management company we believe it would be a 30-45% occupancy rate and more than pay for itself. Some suggest 50-65% and if that's the case, it would be a great deal for us. It would be a great CoC return.

The seller would sell for 60k, realistically it needs 30k to get a marketable/desirable condition for a STR, less for personal use.

We have 15-20k cash to make it happen, but not sure what avenue to go about getting it done. 

How do hard money lenders work if all in was 90k turn around and I had 20k up front? I suspect a hard money lender wouldn't cover the purchase and I cover the rehab, then I BRRR to pay them off?

While conventional financing would work for us to get the deal purchased if we put our 20k down, we wouldn’t have the money for the rehab and therefore wouldnt have it in a rental condition. 

We would be doing a lot of the rehab work ourselves as that’s where my background is. How long to hard money lenders usually lend for? When is payment due? Are there monthly payments owed, or is it all due at a set time? 90 days? 120-180 days?

So many questions, just don’t know how to go about getting it done…

Looks great! Looks like you are well on your way with this property!

I work for an insurance company so I am somewhat biased I guess some could say...

I've been on both sides of this, as the insured with a claim and an employee of a representative of the insurance company so Im able to see different aspects that most people don't think about or care about.

I agree with Stephen in that having a claim history could make underwriting difficult in the future and/or raise future premiums.

To your comment about getting screwed or scammed... you did choose the high deductible in exchange for lower premiums. And you have the option to file or not to file. That's your choice. I don't know what your policy looks like but keep in mind you might only recover the $1,120 IF you have a Replacement Cost policy. If you have a Actual Cash Value policy the insurances company's estimate to repair - less depreciation, could be below your deductible and you get nothing. Keep that in mind as well and speak to your agent again if you don't know!

To Fred's comment about the renters liability insurance. Liability might only apply if the insured (tenant) was negligent in some act. If it was truly an accident, that doesn't mean there was any negligence acts that liability might not apply. Even so in 80% of the time with liability claims, you would have to file under your insurance and then they would subrogate against the negligent party then you might get your deductible back when its all said and done. You wouldn't want to wait weeks or months for their liability adjuster to determine if its covered and then begin repairs. You would want repairs completed as quickly as possible by going through your insurance. Just another thought.

And to J Beards comment about your lien holder on the draft. Some mortgage companies require (obviously they have a financial interest in your property) to be included on the draft from the very first dollar to ensure repairs are completed. Some companies have a much higher $ amount like $7,500 for example. So in your case you would not even have to go through them. And yes I have seen mortgage companies give their customers (you) the run around and believe me, there is NOTHING that your insurance company can do to resolve their slow actions. My suggestion is to find a local lender as you can usually walk right in and get your check signed off on.  

Just my .02

Great idea, but not all tenants will clean it as clean as you or I would. And that doesn't help with grease down the kitchen sink. As I stated this was a washing machine drain line. Likely the build up of detergent and grease from the kitchen sink line over a number of years.

Just trying to pass along what appears to be a great product to use during your walk through.

$10/year (for small bottle) is pretty cheap insurance to prevent the "slow drain" calls you may have to deal with.

Have any of you ever used this product. I had a plumber out the other day to clear a clogged washer drain line and he recommended this product down each drain 2 times a year as maintenance. He said if I would do that, he would never be back to the house.

I looked it up and bought a 2lb bottle on eBay for $24.

Here are some demo videos. Looks like its going to work well if it preforms as well as the demos.

https://www.youtube.com/watch?v=WIhkq0pjJGs

https://www.youtube.com/watch?v=GcogzwgvnvE

Looks like an unfinished garage for sure. And at the back of the garage is the "laundry" area for washer and dryer. You can see the water hookups, black drain line and the dryer vent and 220 outlet.

I'm in East Texas that that house would sit on the market for a VERY long time at that price haha

$160K around here can get you a nice home on a 10+ ac of land occasionally.

I would eliminate the dishwasher all together and consider a double sink. A new 18" DW will probably cost more than a standard DW anyways. That's just one more thing to maintain. If this is a weekend type rental market on a lake then I don't see any issue with not having a DW. Most people will bring paper/plastic and a cooler I would think. Also I would personally go with a small size refrigerator but not a college dorm room size small. You don't need a full size but an average size small refrigerator should work good.

I agree with the above. No washer/dryer. Most people will already have them. 

I am not aware of an insurance company that covers back up caused from the city side. Most accidental back ups that is a single occurrence within the residence premises would be covered. If your policy doesn't provide for that then I would start shopping around. 

I've rented 2 houses in my lifetime. Both times I was required to provide refrigerator and washer/dryer. 

I think tenants expect to have to provide washer and dryer at least.