All Forum Posts by: Josh López

Thank you! I'm not in the area any more but I do travel back and forth a lot to visit family and friends. I am now a Realtor in the Seattle area.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Elgin.

Purchase price: $128,000
Cash invested: $7,000
Sale price: $230,000

Bought my first home out of college and thought it'd be a great idea to buy a multi-family to avoid paying a mortgage out of my pocket but also not having to need roommates. Found an opportunity with an REO that only needed a new roof and interior paint. Using an FHA loan, I only put down 3.5% and had the bank pay the closing costs. I paid only $3000 towards closing and got a new roof added for $4000. I got tenants in the larger unit of the duplex paying $1250 when my mortgage was only $1200.

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

I did not want to be paying a mortgage out of my earned income.

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

Persistence helped me find the deal. The bank gave preference for buyers that were looking to live in the house rather than investors for the first week it was on the market so I took action immediately.

How did you finance this deal?

FHA loan

How did you add value to the deal?

The house was a short sale. It had equity immediately before I even knew what equity meant.

What was the outcome?

Nearly $100,000 in profit after a 5 year hold.

Lessons learned? Challenges?

I didn't know about the BRRR method so I could've kept the property and invested in additional properties. Also, it is very important to have a careful and diligent vetting process for potential tenants.

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

I worked with Dan Rushton of Kettley Realtors in St. Charles, IL.