All Forum Posts by: Evan Manship

Have a very interesting scenario. My brother and I co-own a 4-unit building that we had originally planned to rehab through 203k financing (the property is fresh out of 1970 décor, built in 1910).

However, we have since decided that it may make more sense to pair with an investor who will front the cash to rehab the units, separate the 4 of them, and sell them as townhomes. The rehab quote we have received from our original contractor was about $35k per unit to renovate with low-medium grade touches. However, a local developer and flipper whom is a personal mentor of mine has said that his crew could complete the job for around $25k per unit. The investor is standing by on this joint venture deal.

Has anyone here gone through the townhome/condo conversion and attempted to sell them individually? My project manager (mentor above) understands the ins and outs of legal and zoning issues, but more along the lines of the investment itself -- what advice would you offer?

Glad to have you @Dalton Conwell I am a relatively new investor myself. I recently passed the Indiana brokerage licensure exam and will be registering as a broker in the coming week or two. Feel free to give me a shout if you have any Hoosier-based questions. Good luck!

@Rusty Scott 

I used RECP. It cost about $600 and it took me about 7 days to complete. I read, studied, and tested at home each night. I took the course and completed my final state brokerage exam in about 3 weeks with this system and had no issues.

@Alan A. 

That's a fine question. I would have loved to represent myself in the deal but given the property was on my radar only a few days after I passed my course, I had not had time to run down to the county building and activate my licensure. I didn't want to pass this deal up so I let the listing broker serve as a dual agent and I am very glad I did.

Had I not done so, I think she would have been a lot less motivated to get a deal done.

@Rusty Scott @Rodney Kuhl @Jeremy Tillotson @Justin Owens 

Thanks for the replies, folks. I haven't closed on the property yet, so everything is obviously still up to appraisals, inspections, etc.

That being said, the property is on the near east side of Indianapolis. There is no major rehab that needs done, only small repairs that I am estimating at less than $5k (new gutters, new furnace, etc.).

I have another unit just east of this property that is a 3/2 in a less desirable location that rents for $650 so I expect to get $700 out of this at minimum. My numbers after PITI, reserves, and vacancy indicate about $200-$250/cash flow per month.

Have not considered wholesaling at this point.

After 6 months of reading, researching, discussing, and networking I have finally put my first SFH under contract. I am looking to close by the end of this month and hopefully begin marketing for tenants around March 1 after some repairs are completed.

The property is a 4 bedroom, 2 bath MLS property in Indianapolis. I am a broker in Indiana (though unregistered) so I used the listing agent to represent me. I am conventionally financing this property at a purchase price of $30,000 though I was in talks to have it seller financed. (Seller wanted $40k to hold note because he originally had the property listed for $70k in September)

I plan on leasing this property out for 2-3 years then attempting to flip if the time is right. There are two (3/2) properties adjacent to mine which have sold for $120k and $125k respectively.  This should render me with $30k-$40k of profit to 1031 into a new, bigger investment.

Look forward to see what the future holds.  Thanks BP!

Update:

The seller whom was offering financing countered my original offer which he had verbally accepted with a $10k premium for seller financing. Given that I don't want to worry with a balloon payment in one year for an additional $10k, it looks like I will be financing this one conventionally. Bummed that I have to deal with a bank but excited to get this show on the road.

Thanks @Joseph Ball and @Brian Gibbons for your assistance. I should specify further - I am the buyer in this transaction. $30k purchase price, $10k down, 1 year term.

I will be fine making the payments and could probably close on the property in cash if I REALLY wanted to stretch myself thin. I'm not worried about the balloon but I do want to make sure that this promissory note and mortgage are recorded appropriately and legal title is mine.

Thanks @Joseph Ball . The financing term specified is only for 1 year as I will attempt to refinance out or bring more cash to the table as soon as possible. Is it worthwhile hiring an attorney to set up a trust for that small period of time?

I am in the middle of putting my first seller-financed property into contract. I am looking for any tips or extra no-nos that BP might have to share along with your first-time experiences.

How do I make sure this thing gets done the best way possible? All info is appreciated.