All Forum Posts by: Jimmy Watson

We are...is it still on?

I can't believe I'm just seeing this thread!  Would have loved to have gone...how did it go?  Good turn out?

My wife & I have been trying to wrap our heads around what's a good buy and hold deal.  For instance, we are looking at one currently that could take around $25k out of our pockets, but it would cash flow around $500 a month (before vacancies & maintenance). 

From local investors, I'm getting "That's way too much out of pocket!"  Or, That is a fantastic cash flow!"

I think both statements are correct. For me, that does seem like a lot out of pocket...but it's a great cash flow. My naive ARV range is $75-$125k. I'm being told my max LTV will be 75%. I'm not finding (and maybe I'm not looking in the right places) the deals that would get even close to $0 out of pocket. To top things off...things are skyrocketing in the Dallas area it seems, which makes it even more difficult to find deals that aren't going to take $15k+ out of my pocket.

Thanks for reading.  Although I'm frustrated and venting, I would really like some input on how to relate out of pocket vs cash flow.  Is the out of pocket amount plus the amount from cash flow a personal amount (comfort level)?  Should I be looking at this as cash on cash return and if I'm comfortable with the monthly cash flow?

Thanks!!!!

This house is located in Garland, Dallas County, TX.

Hello all!  I'm looking at a rental property that has a garage conversion that has left the electrical panel in the newly created bedroom.  Is there any regulations against this?  Also, this same room has two small windows that don't open and can't be used as an egress.  This could be termed a flex room...?  Any thoughts on this room/situation would appreciated.

Thanks,

Jimmy

Good question.  Anyone have any input on utilizing the list? 

Why not both?  

What price range are you looking at if you flip?  Will you be using hard money to fund the rest of the flip project?  

From experience, hard money guys like to see at least 15k (your skin in the game) in the bank before they will give the green light on funding your projects.

I have not personally done any wholesaling, but from what I have gathered, you would have plenty money left over for a good marketing campaign!

I am looking for our next rehab project in the North Dallas, Richardson, Plano, Allen, Fairview, Sachse, Wylie, Murphy, and Rockwall areas. 

Up to 500k ARV preferably, but could go higher depending on the deal.

Able to close in 10 business days.

I would also be interested in buy and holds.

Thanks,

Jimmy Watson

Welcome aboard!

I'm a fairly new investor, but I will tell you what I think about the numbers based on my experience. 

You can wholesale at any price point.  Our current project is $500k.

If I took this deal using my hard money formula, assuming your numbers held up (rehab & arv), I would loose approximately $9,000. 

Having said that, I haven't had the privilege of not using hard money for a flip.  So, if I were able to use cold hard cash and not hard money, I might walk away with $9,000.  Hard money or not, I wouldn't take the deal personally.  The deal would look more attractive if you could get it below $325,000.   

My hard money numbers would look like this;

$425,000 @ 70% hard money loan to arv = $297,500

Up front hard money cost, 3% of $297,500 = $8,925

12% interest on hard money, 3 months of rehab and to get it sold = $8,925

Total hard money for 3 months = $17,850.

Hope this helps!