All Forum Posts by: Erran Brown

David Edwards

Thank you for the reply, yes all the numbers are good. I have run them multiple different ways. Also thank you for the information on hard money lenders, I know they are out there but I have never used one. 

As the title says I am new at this. I am looking at a SFR to buy for my 2nd rental. The problem is, the house is uninhabitable the way it sits. We have spoken with the agent and was told that they are not willing to do any more work at the price that it is for sale for. I am looking for ideas on how to proceed with purchasing the property. Right now I am unable to pay cash so I will have to get a conventional loan. I have not asked but I do not believe that the owner will do "owner finance". The 3 issues that I am concerned with is

1. Water heater is not installed, (It is just sitting on the kitchen floor)

2. Heat source is there but no power to see if it is working or not. 

3. I dont know how an inspection and appraisal will go with no light fixtures, sinks or toilets. The power and water have to be shut off.  

The house is in good condition but they are or were in the process of rehabbing the property, the water heater is in the house and it has a heat source but not in working condition that I know of. I know I have heard someone say before that they get an offer accepted and have a contract, then they will go and install a water heater or whatever is needed with there own money so then they are able to get the loan approved. So I am looking for any ideas on how to make this deal work. 

 I will take you up on that offer, I will get with you shortly.

@Ruth Blue Nope...

@Grant Doyle

I'm new to investing, just bought my first property in July. I had cold feet but not for to long. See I went over the numbers many many times using all the different scenarios I could think of just to make sure the numbers worked out. After doing that I felt much better. I will have to say everything that has been said above is correct. You said the property appraised at 189k, if you fixed everything, what would it appraise for? I know I looked over different exit strategies to make sure I could get out or not.

It appears that there might be alot of repairs that will need to be done soon. Do you or can you get the money to pay for all that if need be? If you have to borrow the money for repairs will you be able to make that payment along with all other expenses? These are the questions I would be asking myself. I'm thinking it might not be a great deal but then again I don't have all the information that "I" would need to make a decision.

Looking to speak with a real estate agent in the orange Beach Alabama area. I have some questions about vacation rentals. Looking to maybe purchase one, but I don't know much about the area or vacation rentals in general.

Thank you for the replies, very good points to consider. 

Hello all, I have a question. I know it has been asked many many times, but since I am new and my situation maybe a little different, I figured I would put it out to everyone. I just bought a SFR that came with tenant. I know the previous owner personally and he has advised that the tenant has been a great tenant that pays on time and does not complain or ask for much. The tenant has been in the property for over a year and is now on a month to month lease. I am currently working on a new lease and I am trying to figure out if I am going to increase the rent to market rent. The previous owner just added HVAC to the property as the tenant only had window units. He advised the tenant before he sold the property that the rent was going to increase, and the tenant was ok with the increase. I have looked over the house and the tenant has taken very good care of the property. The current rent is 650.00 he advised the tenant it was going to increase to 700.00. I have looked and market rent is anywhere from 750.00 to 850.00. Should I keep the rent at 700.00 or increase it closer to 800.00 (or more)? When I ran the numbers to purchase the property, I did my calculations on 700.00 a month and was OK with the numbers. After all was complete with closing, I am getting and ok CoC return and cash flow, but it could always be better. Any advise is appreciated and thank you in advance.

Thank you

 Thank you for your reply,

From what I see, water sewer are tentat paid it is all electric and metered separate. The down payment should be 25% that is one rate I was quoted, it is a foreclosure and other duplexes in the area have sold from 100k - 175k. There are 4 more duplexes on the same street that if sold could average that price. That is the best comps I could pull. The borrowed money will be paid separate through the family member and I have not worked out all the details. I was also looking at maybe refinancing to maybe pull cash out to pay back the family loan, all depending what it appraises for and what I can get for rent to cover the higher loan payment. There is not a lot that I know of that I can raise value, I am just looking at comps that is where I am coming up with the numbers.