All Forum Posts by: Matthew Nicklin

@Emmanuel Magana It really depends on your state and area. Are you a member of any local RE groups that may have recommendations or local hard money lenders? You can also call around local community banks to try to find some that are investor friendly. 

@Gregory T. Washington No that is the best part! You do not have to pay taxes on that excess cash. As this is a loan it is a non taxable event. If I were to sell the property I would pay taxes. This is one of the biggest benefits to the BRRRR method.

@Aaron Winters In Georgia there is no right of redemption for foreclosures. There is a 1 year right of redemption for tax sales but judicial and non-judicial foreclosures do not have a redemption period. 

I have been investing in Real Estate for the past 10 years. I started out with a very small amount of private money($20K) and my own cash. I used private money and my own cash until I was able to secure a primary residence with a lot of equity. As soon as I was able to secure a primary residences with a sizable amount of equity I obtained a HELOC. I continued to buy the next few rentals cash(From the HELOC) and worked to pay down the HELOC as quickly as I could.

I was able to continue this because I had great cash flow from my other rentals, w2 income, and my commissions from being a Real Estate Agent. I now have 5 rental properties and they are all occupied and cash flowing nicely.

I never used the BRRRR(an acronym that stands for "buy, rehab, rent, refinance, repeat.") method until recently when I purchased my 4th rental due to the amount of equity I had from this property. This property is a great 3 bedroom/2 bath home in a nice part of town. I got the opportunity to bid on this property at auction and I was lucky enough to win it for $67,200…To this day it still shocks me that I was able to purchase the property for that price, as I knew it was worth at least $175,000.

Once I had possession of the property I had one of the contractors that I work with go in and do a full rehab. They painted the entire interior, re-floored, fixed damage, etc. I spent around $13,000 on the clean up and rehab. The place looked great and I listed it for lease for $1,375. My phone rang off the hook and I got it leased quickly.

I started calling around to see what I could do about a cash out refinance on the property. Some lenders I spoke to required 1 year of seasoning, others required 6 months. I did some additional research and found that Fannie Mae’s requirements were 6 months. As soon as I got close to the 6 month mark I did some shopping and decided on a lender, ordered the appraisal and moved forward. The appraisal came in at $183,000! My numbers were confirmed!

ARV $183,000

Initial Purchase $67,200

Rehab costs ~$13,000

Total cost in the property with purchase and rehab $80,200

Allowable cash out with 75% LTV $137,250

Closing costs were around $5,000

Cash at refi closing was around $132,250

Excess cash above what was initially invested($132,500-$80,000)= $52,250!

All that and I am still cash flowing a little over $300 per month! I am off to go find my next deal.

I posted this to give back to the community. I received a lot of help from my Father who has been investing in Real Estate for a while. I have also read and received a lot of great advise and inspiration on this site so I wanted to post to add another inspirational story. 

So I studied and passed my Real Estate Agent's license while I was still in College. Looking back I am so happy I did. I feel it is much easier to study if you are still in school mode. I am now a Broker so it paid off big knocking out the agents license early. 

If you are serious about Real Estate I would recommend what your parents recommended and try to study for RE while you are still in school. Is your major business related? Maybe you need to change majors? Does your school offer anything in the RE field? 

I wanted to see if anyone in the BP community had any experience buying a Real Estate Brokerage that also does Property Management? I have the opportunity to purchase a Brokerage that does Property Management. I feel pretty comfortable with the deal on a high level but I am sure there are a lot of little things I also need to look out for. What is the average per door worth on the open market? I am sure it is variable depending on the area, number of doors, and commission etc. Like I said I feel pretty comfortable with the deal right now just want some input from others that have gone through the process.

Obviously I would utilize an attorney who specializes in Business Brokerages to facilitate the transfer, as I want to ensure it is done properly. Anything I should specifically request be included in the deal? I already have a few that both parties agree on. 

Any and all feedback would be greatly appreciated. 

I would agree with your current classes that you have for the areas in general. Without looking at the actual complex or neighborhood it is difficult to be more specific. I would certainly rank Norcross higher than Lithonia as income is higher in Norcross. If you don't mind me asking what are the CAP rates for these deals?

Do you actually know where the person went? If they just vanished you would have to locate them. I have a good attorney that I would be happy to recommend if you felt it was worth it. I used to think it was not worth it until recently when I had a client collect on a judgment as a previous tenant wanted to now purchase a home. Lender said it was a condition that needed to be cleared before they could approve the mortgage. 

Disclaimer I don't do a lot in Gwinnett but it looks like you can pull this data directly from their website. Go here https://www.gwinnettcourts.com/casesearch/bydates....

Then filter by Magistrate Court Civil, then for category specify dispossessory. You may have to cross check to see if the plaintiff is the property owner on the tax records etc but that is the raw data. 

@Jessica Freesia Prices are actually pretty reasonable, all things considered. I believe it was around $200 for the first hour and then $95 for each 1/2 after that. Which is pretty reasonable when you consider they are sending 5 people out. You can call them for more specifics, they are very nice. 

@Moncy Samuel I am unsure what the Dekalb County Sheriff advises, but I know the Cobb County Sheriff advises you not to tell the tenant what date they are coming. They do this strictly for security as they have had incidents where people were armed and resisted.