All Forum Posts by: Brandon Sok

Only when the tide goes out do you discover who's been swimming naked.

Warren Buffett

@Casey Roloff I've got 2 owner financing scenarios in play. I'm tracking with your bullet points but can you explain the 100k interest received given 5-year balloon? Were payment terms 10k of interest paid per years for 5 years then the remaining 100k due at balloon payment?

@Scott Stahr 1) In an ideal world you would have a renter in place first so that all payments of the new mortage are made by renters and not you. BUT I'm sure there are other opinions on this. 2) To answer this question we would need more information. How much did you purchase the house for? Was it cash or with a loan? 

The podcasts are a great way to learn more about BRRRR. The one posted today talks about it indept. One thing that I just recently learned, on a refinance banks typically only loan 70-80% LTV meaning if the house appraises at 200k then the bank would only loan $140k-160k. Hope that is helpful.

@Account Closed Thank you! It is a SFH.

@Frankie Woods Thanks for answering these questions. Insanely helpful as I'm piecing together a BRRRR

@Russell Zuck and @Tyler Gibson I am piecing together a similar deal. How are you all calculating 1% per month? Am correct in thinking its Interest Amount/Term rate? 

In my example a 130k loan at 12% with repayment at 24 months --- 130k x 12% = $15,600 then divided by 24 months = $650. So if I repay in 10 months my carrying costs for loan would be $6500?

If I understand the Refinance piece of the BRRRR Method correctly... The banks will only pay 70% LTV on the appraised ARV. So a house worth 180k, I could refinance at 126k. Is this correct?

My follow up question is this: If I am using private money for purchase and rehab costs, the private money loan + interest should be less than 126k so that it can be paid off by the refinance? 

Investment Info:

Small multi-family (2-4 units) other investment.

Purchase price: $89,000
Cash invested: $48,000

Duplex that we House Hacked. Put 20% down + 30k in rehab expenses. Cash flow is $1200 per month. ARV is $170,000. We haven't fully executed the full BRRR but are considering.

@Joseph Cornwell & @Tyler Wehrung Thank you for taking the time to respond. Both posts are very helpful. I have a much better understanding now.

Are either of you aware of the the implications of the new tax laws? Do anything change?

@Thomas Castelli thanks for the response. So he'd have to establish his tax basis then adjust depending on improvements, etc.?

Single family purchased for 55k, duplex purchased for 53k. For the sake of creating a full situation lets say he's done 10k in improvement for each. So his basis for each:

• Single Family: 65k
• Duplex: 63k