All Forum Posts by: Matthew Anderson

Thanks for response...

So I fell into this property through word of mouth, mostly cosmetic issues. It is actually a great area to live. The deal is not done, so I don't want to act like it's set in stone, but that was the number the owner provided. With regards to rent, I have friends who own rentals in the area and that is a conservative number. Given the info I provided, how would you assess the return, both using cash for D/P, C/C and repairs vs HELOC then refinance.

thanks again

I wanted to run a situation by whoever wants to participate. I wanted to leverage equity on my home to buy a rental property, here would be the numbers... Criticism very much welcomed...

Price: $120,000 Down payment: $30,000 Est Closing costs: 5%: $6000 Est repairs: $20,000 (All funded by HELOC: $56,000 )

Conservative rent in the area $1600.00

PITI: $777.00

PM: $150

Vac Rate : 8% ($125)

Maintenance/repair/capex: $200

HELOC interest pymt: $350.00

A conservative ARV would be approx $190,000

Is there any circumstance where this can work?

Do cash flow rules change when deal is financed by HELOC with intentions to refinance ASAP?

For example: if refinancing to combine HELOC and original mortgage loan ($146,000)... new PITI: $1150.00 plus expenses now equal $1576

cash flow $24.00/month 

questions welcome...tear it apart, just tryin to learn

Thanks!