All Forum Posts by: Mickey Petersen
Mickey Petersen has started 20 posts and replied 52 times.
Post: Clarity on Cash-Out Refi
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Quote from @Clara Levy:
Hi All,
I need some clarity on the last R in BRRRR, the Cash-Out Refi. Think of this like a math question please with a Yes or No answer.
If property is bought at $140K, 25% down meaning $35K. Rented out for $1500. Then 2 years go by. Still rented. And for XYZ/whatever reason the value/appraisal stays at 140K.
And Lender is willing to do a 80% LTV Cash out Refi. Will I really get 80% of $140K, meaning $112K? Even if my equity has barely increased from the initial %25 down? YES?
Or NO? Lender would only give me about 5% of the $140K, meaning $7k? (Because they have to leave 20% of equity in the deal).
Appreciate the clarification in advance.
It depends on how much equity you have in the deal after 2 years. How much has the loan been paid down? But that’s right they will want 20% left in. How much is the balance of the current loan?
Post: Just Closed On This Property
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Thanks Del!
Post: Just Closed On This Property
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
We just closed on a new 4plex here in the LA area. It's gonna need full renovation. The current rents are far below market rents. We have a 6.25 interest rate that will start adjusting after 6 months. So time is money on this one. Ill keep you updated along the way.
Post: Value Add Midwest Duplex
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Investment Info:
Small multi-family (2-4 units) buy & hold investment.
Purchase price: $66,000
Cash invested: $30,000
This is our smallest but probably the best deal we have made as far as cashflow. Only had to update one unit so far. The mortgage is low and the rents are good. This is our only midwest property.
What made you interested in investing in this type of deal?
This was the first deal we ever did. It was a cheap property so it was good for starting out.
How did you find this deal and how did you negotiate it?
Agent / MLS
How did you finance this deal?
Conventional Financing
How did you add value to the deal?
Updated units
Post: Southern California Value Add 4plex
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Investment Info:
Small multi-family (2-4 units) buy & hold investment in Redlands.
Purchase price: $650,000
Cash invested: $38,000
Sale price: $895,000
This property was in good condition when we acquired it. All but one unit was close to market rent. We did update two units once the original tenants moved out. This allowed us to get the current market rents. We also, installed drought tolerant landscaping to save on water and maintenance.
How did you find this deal and how did you negotiate it?
Off market deal by agent.
How did you finance this deal?
Conventional Financing
How did you add value to the deal?
Updated units as tenants moved out. Added drought tolerant landscaping.
Post: Value Add Southern California Duplex
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Investment Info:
Small multi-family (2-4 units) buy & hold investment.
Purchase price: $410,000
Cash invested: $15,000
Another full turnaround project. Cash for keys to convince the low rent paying tenants to move out. Updtated both units completely. Floors, cabinets, vanities, paint/trim, blinds, water heaters, clean up landscaping. I know there is no oven hoods in the photos. Don't worry we add new ones.
What made you interested in investing in this type of deal?
Value add opportunity.
How did you find this deal and how did you negotiate it?
Agent / MLS
How did you finance this deal?
Conventional Financing.
How did you add value to the deal?
Updated both units and achieved market rent.
Post: Southern California Multifamily Buy and Hold
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Investment Info:
Small multi-family (2-4 units) buy & hold investment.
Purchase price: $820,000
Cash invested: $28,000
This was our first full property turn. It involved convincing the current low paying rent tenants to either leave or stay at market rent in a newly updated apartment. It went pretty smoothly. All tenants decided to move with cash for keys. All three units were newly updated in about a months time. All units are receiving market rents. We plan to hold this for a few years. We will see what we decide to do once interest rates settle.
What made you interested in investing in this type of deal?
Value add opportunity.
How did you find this deal and how did you negotiate it?
Off market brought by agent.
How did you finance this deal?
Conventional Financing.
How did you add value to the deal?
Updated all units.
What was the outcome?
Great looking property achieving market rents.
Post: Buy and Hold California 4plex
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Investment Info:
Small multi-family (2-4 units) buy & hold investment.
Purchase price: $650,000
Cash invested: $38,000
Sale price: $895,000
This property was in good condition when we acquired it. All but one unit was close to market rent. We did update two units once the original tenants moved out. This allowed us to get the current market rents. We also, installed drought tolerant landscaping to save on water and maintenance.
How did you find this deal and how did you negotiate it?
Off market Brought by agent
How did you finance this deal?
Conventional Financing
How did you add value to the deal?
The rents were low. When tenants moved out we updated the units. Typical stuff like flooring, countertops, vanities, etc. We also installed drought tolerant landscaping.
Post: Riverside California Duplex
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Investment Info:
Small multi-family (2-4 units) fix & flip investment in Monticello.
Purchase price: $650,000
Cash invested: $6,000
Sale price: $750,000
This wasn't meant to be a fix and flip. At the time we sold the market was increasing quickly. We decided to 1031 exchange for another Southern California multifamily property.
How did you find this deal and how did you negotiate it?
Off market deal brought by agent
How did you finance this deal?
Conventional Financing
How did you add value to the deal?
This one appreciated quickly on its own
Post: What if I cant seem to find a positive cash flow deal in market?
- Investor
- Long Beach, CA
- Posts 57
- Votes 33
Thank you @timswierczek ! I will definitely contact her. I appreciate the advice!