All Forum Posts by: Aaron Carter

The house is in a rural area and has a septic so there should not be any cast iron waistlines everything would be pvc, which could also crack but shouldn't if it is sloped correctly. One thing I didn't think about though is the possibility of a sump pump that may need to be replaced... I will have to look into that. It is heated with forced air so no worry there. I have not been able to get into the house yet as it is being advertised as "possibly occupied" foreclosure but I know that it is vacant. I am going to see if I can find a way to go look at it some time this week to see if there may be any water damage.

 There is a basement, however, unfortunately, it is a finished basement, meaning I would have to remove a good portion of the ceiling drywall to get at it... It would not be the end of the world but would add quite a bit of labor cost.

1. So I am looking to submeter the natural gas and water of my duplex. Has anyone used the submeteres from Inovonics or ekm metering? I would like to submeter without having the utility company come out and install another meter thus passing along another monthly access charge to my tenants of approximately $30 a month as well as another initial $800-$1000 for the initial install. If this works out I have another property I would like to do this for as well. This would also be an excellent solution for multifamily properties that use off peak electric and propane for back up heat source. If you have used these is there a company that offers third party billing for such a set up? If not, maybe this would be a good entrepreneurial opportunity. Thoughts?

I am looking at a foreclosure on hubzu. It is being sold as-is cash only. Starting bid $135,000. ARV comps around $215,000 conservatively. I know that the house froze last winter. Is this something that you would consider? Hubzu states that the house is occupied but i know for a fact it is vacant as my mom, who is a realtor just showed it about a month ago before it was foreclosed on. I have purchased a property through hubzu before and know what to expect. I have done two rehabs for buy and hold, this would be by first flip.

I a planning on having to replace all plumbing with pex, toilets, and hot water heaters. also needs flooring and other standard basic cosmetic upgrades. Anything else big that I would need to consider? 

Thanks! That is really reassuring, I really appreciate that. I have learned a lot from BP especially the podcasts but sometimes it gets discouraging when I have not closed on a deal in a year now and  am sitting on equity that could be leveraged... While listening to people getting 15 deals in one year when I am just looking for ONE good deal. But I know that one deal will take up a HUGE amount of my time rehabbing and getting rented. I won't feel too bad sitting on the equity and just wait for the right one to come by...

That is what I have been thinking as well... I only have one loan (our primary) as our other one is under my wife's name. I was thinking that I could likely use the heloc just for the down payment on the next property. The rate is adjustable on our heloc but through our credit union is only 4.25% at this time...

Looking to buy my next property within the next year. I have a Duplex that I purchased two years ago that I owe about $71,000 on and am thinking of refinancing it, I have done significant value add. Cash flow of $500-$600 a month and rents are due to be raised next year. I think it would appraise at around $128,000-$135,000 right now which would leave me with a 80% LTV cash out between $31,400 - $37,000.

I currently have the property financed at 4.25% 30 year conventional because my wife and I were living there when we purchased the property. We have since moved out and are now "house hacking" another property where I am closing on a $30,000 heloc next week from our current primary residence.

Is it worth refinancing the first property knowing that closing costs would be around $4,000 and likely facing a higher interest rate to cash out when I don't have another property lined up? I am concerned that I am going to be paying interest on that money when it is not going to be invested right away and it has been difficult to find good deals in my area as of late...

Or should I just sit on my $30,000 Heloc and utilize those funds even if it limits my price range?

Is there ductwork already in the building? I have redone the hvac in three different properties in northern MN and each required different systems. The last one I did was actually my primary residence where I put in two Mitsubishi hyper heat pumps 1.5 ton each at each end of the house. These work down to 16 below zero and have A/C in the summer time all without duct work. I have two of them for my whole 1800 square foot single story house as my primary heat and it works really well and cheaper than natural gas.

If you have natural gas you will likely have to have two separate duct systems and two furnaces to split the gas bill. This is what I had to do with my duplex. In retrospect I wish I would have just done two mini-splits with two baseboard back ups for when it was below -17 degrees.

By the numbers it looks like a solid deal based on cash on cash return. I have not done any section 8 housing in the past but have always been interested in it. For guaranteed returns from the government like that on a $44,000 retail price is solid IMHO. I know Section 8 is a very niche system and don't know if the headache would be worth the yearly NOI (working with many people for small yearly return per person i.e. headaches). I found the book The Section 8 Bible really informative on this subject, you can find it on amazon. It is very good and made me strongly consider doing section 8 housing in the future.

I have heard of lenders doing cash out for up to 80% but I believe 70-75% is more the norm. I have also heard of some lenders doing a HELOC with a much lower cash out, around 60-70%. This would be an ideal situation as you would only be paying interest on the funds you were using at the time. Unfortunately I personally have not found a lender that is willing to do this but am on the lookout. I would check with a local credit union, local bank, and mortgage broker to see what information they can give you. Each lender will have different options and requirements.