All Forum Posts by: Mike Ventura

@Phil B.

I grew up in Blairstown, not to far from Newton. From a numbers standpoint, Newton taxes are tough which could make it tough for finding good cash flow. I guess thats all of NJ for the most part though...

I refinanced my house last month and am following the BRRRR method. Just need to complete the rent part which will happen when I find a new house to BRRRR. I'll let you know how it works from a rental/tenant standpoint. Although Blairstown and Newton aren't booming in any way, people still need a roof over their head.

BRRRR Success is finally here...well almost here. I still need to rent my property but I'm parking that for a moment.

Here is the link to my original post that outlines the numbers.

So here is the update. I just got the result back from the refinance this afternoon. My target value was $180,000 after I rehabbed and it actually came back at $200,000! Always a good thing to be conservative! So I'll get all money back and be on to the next one. 

Now I need to rent the property, which I'm currently living in. Before I do so I'm going to keep my eyes peeled for another deal and try to close on it and just keep the process going. 

Let me know if I can help your journey with my success. I'm no expert but I've put what i learned into practice and its working so far. Now to read up on screening tenants!

Christopher Phillips thanks for the insight - so comps are the way to go? This is challenging because no other bed and breakfast has sold, I don’t even think there’s another in the town...

Jason DiClemente well done! All the best with the next steps. What credit union did you use? I’m looking at my next deal to BRRRR and the refinance options look attractive. Thanks Jason

Easy question right? I can’t wrap my head around it. I’m trying to line up my next deal but I don’t know how to value the property. It’s unique - listed as a single family but used to be a B&B. Now the units are rented out individually. Gross income would be 6500-7000 with last unit rented out. Current owner lives in it. My goal is to purchase with hard money. Only issue is I don’t know how to value the property. Which then presents an issue when I refinance out of the hard money 1yr term. It was listed at 545k. - Zillow, Realtor, Trulia all have the property in the 375k-400k range - town assessor has it at 500k (last assessed 2001). I called him and he said properties are selling for 10-20% over their assessment. - listed at 545k Bottom line there is a huge spread.. I’m stuck! Any recommendations on how to arrive at a valuation? Thanks!

Taylor C. Great question and I wish I knew the actual answer. I would estimate around 50 hours each month, May - August, so probably 200 hours. The profit should be $5000 after closing costs. So I worked at a rate of $25 bucks an hour which isn't too bad.

Hello BP!

Excited to share that I am closing in on the "Refinance" portion of my first BRRRR. I wanted to share everything noteworthy up until this point. Including some before and after pictures. Hope you enjoy. PLEASE share some feedback!

The Property:

• A little over 1.25 acre
• 1056 SqFt
• 3 Bed | 1 Bath Ranch
• Full Basement (unfinished, may do this at a later date and refinance a second time.

Financing:

• Purchased with my own money. My goal was to rehab and live in the property until I could refinance – hopefully 6 months. Target month was October, on track! Just need to do some exterior yard work!

Numbers:

• Purchase Price: $100,000
• Down Payment: $5,000
• Pre Closing Costs (septic test, well test, etc): $1,937.38
• Closing Costs (not including down payment): $5,706.86
• Rehab Costs: $14,983.18
  • Includes first time purchase of tools needed, shop vac, miscellaneous supplies that will be used for future BRRRRs. I didn’t back these expenses out because they were crucial to me completing the work.

Refinance:

• Zestimate from Zillow is coming in at $200,000. Hopefully this is somewhat right!
• Target Refinance Property Value: $180,000
  • 75% LTV : $135,000
  • Anticipated all in costs + Loan Balance of $95k: $122,607.42
  • “SHOULD” get all of my money back ($27,607.42) in addition to some profit depending on the closing of the refinance.

Kitchen:

Living Room:

Jason DiClemente so if I understand the monthly interest payments are roped into the loan amount? I also found that you need an LLC in NJ... Has your credit union given you an idea of the LTV they are willing to provide at refinance? Looks like if they loan 70% you'll make some profit on the refi. Good to hear the renovation estimate came in under budget. On a first deal I think that can be challenging to nail and sounds like you did a good job?

Hey Jason DiClemente congrats on getting this deal across the line. Looking forward to seeing the before and after pic. I've just finished a rehab on my first deal which is a BRRRR. I did everything for mine out of pocket with my own money. I'm interested to see the nitty gritty details of your hard money loan as I may use this at some point. Can you break it out out in a timeline form? From down payment through months 1-9? And for the refinance to pay back the remaining 80%? Or perhaps you've come across a post that really dumbs down a HML that you can share with me. Thanks!!

Vincent P. Great success story Vince, congrats! I'm on the hunt for a MF in Warren County NJ. Struggling to find the financing as I'm working a BRRRR deal right now. The refi is going to be in October/November. Did you invest your own money or other means?