All Forum Posts by: Mason Gibbs

@Ivy Baca it’s a complete gut job the home is 90 years old so we will be doing everything.

@Zach Westerfield this information is great I will take your advice an estimate more than six months.

@Michael Ward thanks for this information I wanted to go to a local bank but the seller wants to close fast and needs cash or hard money. I am thinking maybe this is not a good deal for me and I should research more on the hard money loans and save more to further build up my cash reserves.

@Nicholas L.

No offense taken. Your point is completely valid. I do have some cash reserves but saw the $21K for holding cost and thought maybe I am missing something so that 's where my question came from. I was wondering how others financed their holding cost while keeping their cash reserves. 

@Wayne Brooks

Thanks for the info on the property tax, I will look into how that changes my holding costs. Also thanks for the calc on the loan payment that lines up with what I have. 

@Matthew Crivelli

The rate I was quoted was 11.99%  over 6 months. I must be doing my calculations incorrectly. 

So sorry my calc was off, the total is really = $3139, is that still high?

@Matthew Crivelli 

Here's my calculation

$2130 - Hard Money Loan Payment

$459 - Property Tax

$50- Insurance 

$200 - Utilities

$300 -  Accounting & Misc fees

Please let me know if I am missing something or if I am being too conservative. Any advice would be appreciated.

I am looking to flip my first property. I have a good deal with a potential profit of ~$30K. I have enough for the downpayment and to get started with a hard money lender but my concern is the holding cost.

Here’s the deal:

Purchase: $165K

Rehab: $80K

ARV: $340K

Down payment: $40K

Cash available:$25K to get constitution started and misc items before the first hard money installment

What’s holding me back from starting:

Holding Cost: $3600 per money

Holding time: 6 months = $21,200

I have things lined up for all the upfront cost but my concern is the holding costs. How do most people finance the holding cost? Do you use a line of credit? Or are the costs too high and I need to reevaluate the deal.

Again this is my first deal so I maybe missing something. Any advice would be greatly appreciated.

Thank you.