All Forum Posts by: Tyler Blackwell

@Dick Rosen for $13k we're getting custom locally-made walnut cabinets in our new kitchen at home. So...your cabinets must be nice!! I would check out Pacific Stone and Tile for counter tops if you want to go high end without the huge cost. They have some nice quartz options for around $45/sqft. Know of anything better than that?

@Ryan Detig I'll check out the RTACabinetstore for future flips, that sounds really reasonable. 

Josh--great job man! I'm a Montana native (Great Falls, then educated in Missoula), so I'm happy to see some Montana folks on BP. Congratulations on the success.

I feel the same way about real estate and the ability to add some serious net worth and create big wealth quickly. I started about the same you did (I'm 32 now) and incidentally, last night my wife and I just did our net worth calculation, something we do ever quarter or twice a year. It's pretty remarkable how the net worth changes, and it's fun to see after you do a deal, or a couple, how much impact that deal has on your value. Our first goal was to own $1M in real estate, which we did. Now, it's to have a net worth of $1M. Just 18 months ago it seemed like it would take forever. After a couple great buys (buy-and hold and fix ups), we're thinking we'll get there VERY soon!! 

Keep doing what you're doing. We're running in the same race.

Thanks @John Warren for the resource. @Crystal Smith, I'd appreciate any recommendations you'll offer. I don't the lender meant harm, I really think she thought she could do it (of course I've been on the wrong side of that before, too!!)

It sounds like it's possible to do cash-out refi before 12 months, what about before 6 months?

Hi @Yingchun Li, the lender is saying they can do a cash-out, but it would require a full 12-month seasoning. There are no issues with debt/income ratios. This is disappointing news because I've asked the lender if we could do this and they acted like they could do it all day every day. We don't have the final word yet on the appraisal, but based on comps it should be in the neighborhood of $290-315k. We have owned it now for about 4 months, and we finished rehab and have it rented now. Just wondering what other folks do. I'll probably email our HML and see if they know anyone willing to do the cash-out refi, since they likely have those connections.

I have a question for those who have done it: 

@Nathan Click@Crystal Smith@Shu Zhu@Yingchun Li@John Warren@Ceril S.@Julie Marquez@Ruth Bayang

I am doing the BRRRR strategy right now. We bought a house for $140k, put in $85k, and it's worth $300k. I was hoping to refinance and pull 25% out ($75k). Seems perfect, right? Slam dunk success, yeah?

Well, in order to get the hard money loan, I put down $70k. The loan amount was $205k (purchase plus original rehab hold back), so with my down payment the total I was borrowing was $135k. Now that I'm going to refinance, my lender (who I've worked with before on other projects but just not via this strategy--which by the way when I asked if we could do this she was very confident we could!!) says they'll only loan for what the payoff amount is for the hard-money loan ($135k). This means we can't pull any of our down payment out, which is significant and having that cash would allow us to do another deal ASAP! This is obviously not ideal, and we'll have $150k in equity sitting in our buy-and-sell-in-a-little-bit house. 

What's to be done? Find another lender? For context, our HML is 6 months and we're on month 4. I was told if it were properly seasoned for 12 months we could do a cash-out refi, but that doesn't work for us. Does anyone know of a better strategy? I'd like to be able to pull funds out now and look for the next deal. Obviously this strategy isn't sustainable if you can't pull out your initial down payment investment...

Hi Christina,

What size are the units? $1900 for the duplex doesn't sound unreasonable in Tacoma, but if they're 2/1 units in pretty good shape you can probably get more. That said, there are a couple other things to consider:

30 year mortgage would be $1075 with 5% interest. If you are looking for paydown, a 15 year loan is great (I have used them), but cash flow suffers. Typically you can get better interest rates, but if you think the units will require some work (your repairs/capex is higher than I usually budget), then a 30 year loan might be more beneficial.

I have a fourplex in Centralia and the insurance is $80/mo. I'd imagine you could find insurance for the duplex for $50-$75/mo?

Your number for vacancy is really high for the times. If you consider it long term, maybe it's not bad to pad your numbers, but even 5% is on the high side at the moment. All the same, I think the numbers were miscalculated, since 10% of 1900 would be $190.

Utitlies around here are what you make them. Typical in Olympia is for landlords to pay W/S/G, which runs about $80-100/mo. 

So yeah, if you run different numbers, you'll get a better end result, but it won't be a fantastic return. @Mary Bailey has mentioned the oft-cited 2% rule, which you just can't find these days here in the Puget Sound (if you can, clue me in!). However, I normally won't buy unless I can find something that at a minimum meets the 1% rule if I'm looking for a buy-and-hold rental. 

Best of luck!

Capex items can be a killer in the land of the $30k property. A roof still costs the same in Louisville than it does in Utah (or anywhere else)...

I know you're not supposed to bet on appreciation, but I imagine that the north Utah area is going to rapidly appreciate in the next few years. Cash flow is definitely important, we'd all agree on that, but if you can get some cash flow in Utah and awesome appreciation, I think I'd personally prefer that to Louisville, where things can cash flow well but the market is static. But everyone invest differently :)

Time to raise the minimum rental criteria?? :)

Pretty good tenant pool to choose from in Seattle...

I had him come through a project house in hopes he'd give me a bid on the project. I had seen him post a couple times on BiggerPockets and figured he'd be investor friendly. He was a nice, easy-going guy, but I think at the time the scope of work was a little big for him and he had a couple active projects and our timelines didn't coincide. I went with someone else considering we are using hard money and couldn't wait for his other projects to finish. 

Hey Cam. There are probably a bunch of companies that do rental umbrellas, but I have a policy through Nicholson Insurance. They're brokers (I believe) so prices are really good for auto and home as well compared to the big names.