All Forum Posts by: Luis Bermudez

Hi Ms. Kelly, if you're still interested in real estate please reach out.  I am also in East Stroudsburg.

@Travis Wylie Thanks for the advice.  I have been looking into property managers.  The contract fell through.  There were many more needed repairs than the seller was willing to admit.  On to the next.  I have no interest in managing properties, ever.

@Taylor L. @Jay Hinrichs

thanks so much for your input.

I have my first investment property under contract.  I'll pretty much exhaust my savings in acquisition and repair.  In discussing my goals and approach with a couple of people, they expressed an interest in investing money in the idea.  As I was unprepared to have such a conversation, I simply said I'd consider it and get back to them.  Do I make them partners in each deal where ownership is shared?  Do I offer a minimum interest rate for their investment and additional bonuses for certain benchmarks being met?  I know there are some SEC issues so I'm treading lightly.  Please let me know what you think.  Thanks

UPDATE!!!  @Ola Dantis I may have underestimated the mindset books.  @Kurt Michaelson recommended "If you can't wholesale after this..." and I'm mesmerized.  I have purchased nearly a dozen of the books recommended since I started this post.  With the intention of completing one a week I will have a opinion post here weekly.  I'd really like to continue the discussion on wholesaling.  Thanks again for all of the input.

@LucasDuce Thanks for your input.  More Details:  It's a 4 bdrm over a 3 bdrm.  I don't know if that's considered a duplex.  I will renting rooms as opposed to apartments.  Harrisburg, PA allows 3 non-related tenants per apartment.  House has 7 bedrooms, I'm only renting 5.  I will be living there for a year.  

You are correct.  Renting each apartment would bring about $750-1000/mo. As a truck driver that won't be there much, I feel comfortable renting the rooms.  I think I'm even being conservative with the room rate as I've heard this area can get as much as $600/mo. for a room.  Now that I'm typing this I realized I didn't add the cost for electric, there is no gas.  

All of my comp data is speculative.  My agent and I are completing comps by the end of the weekend.  My due diligence is not complete.  I anticipate having all my I's dotted and T's crossed by Monday AM.  Thanks again for your input.  I'll keep you posted.

Thanks for all of the feedback to this point.  Here are current updates based on the facts of the case:

I am using bank financing. I'm am using an FHA loan. 3.42% PITI $675 with PMI.

I have 3-5 contractors viewing and preparing estimates that I should receive by the weekend. All numbers presented in my original post were guestimates given by contractors I spoke with over the phone based on my explanation of repairs needed.  I have since spoken to one contractor that has viewed the property and suggested his estimate would be in the $18 - 20k range. He even recommended other things (repairs) that required attention.  

I used the rental property calculator and posted results for review and counsel.  Calculation suggests property will cash flow $540/mo.  considering repair costs.  Problem is I don't have $20k cash.  

The cash flow is based on renting rooms (5) at $500/mo. and renting the parking space for $50/mo. It takes into consideration a 12% vacancy rate and an aggressive CapEx exp considering we may be extending the life of most of the CapEx items immediately.

View report

View report

*This link comes directly from our calculators, based on information input by the member who posted.

I have my first investment property under contract for $87,500.  It's probably worth $67k, but I think it can still net $1000k/mo. after ALL expenses.  I signed a contract without adding the inspection contingency.  I had an inspection done and learned the main sewer drain needs to be replaced.  A portion of roof needs replacement and their are numerous repairs ranging from basic to intermediate throughout the property.  Do I loose the $3k earnest money (too much, I know now), or push forward?  I have no trade experience but, guestimate the repairs to be between $15 and 20K.  I wouldn't be surprised if it were more.  I don't have the cash to make the repairs.  I would need to change the loan to one that would allow me to borrow above the purchase price to make repairs.  After all the reading and podcast watching the truth is clear: You don't learn this business until you do this business.  I've already learned so much.  I still think this property is a profitable asset at a $110,000 investment.  The seller is willing to continue to negotiate given the enormity of repairs required.  How do I find additional funding if necessary?  I've never needed professional, experienced advice like I do now.  thanks, in advance.

@Ola Dantis I agree 100% on setting the mindset foundation. And thanks for the additional recommendations.