All Forum Posts by: Matt N.

Philly Team,

Hi! I can't seem to find how to get the suitability cert anymore. The link i saved for myself is the same link in the original post... it just takes me to Eclipse where my activity licences are. Can someone help me find the Cert of Rental Suitability link/page? It's been a few years since I have had tenant turnover so I'm assuming the page moved. 

TIA!

Matt
 

Here comes the hail mary of updates:

Paid the first bill for water service. Ok cool. I got bills now...

Got the second bill.. ZERO balance?? WTF? Ok cool. 

Third bill.. ZERO balance... now i'm making calls... Turns out i was credited over 6k from the water company!! So this seller's hard work finally paid off (for me) and now the water dept owes ME 6 grand!

I'll need to figure out how to get it out of their coffers but hell, 6k is 6k.

Happy Hunting!

@Robert Painter ... you said the bad word. Afraid. DON'T BE. Instead be smart and patient. 

Find one of those on a better block, near a better area, in a growing area, then be even more patient. Take your time fixing it, if you bought cash you wont have much carrying cost. NO mortgage at least. So whats wrong with taking time to fix it and taking time to find those GOOD tenants? 

Dont be afraid. Be smart. Be better then the others. Be diligent. Be persistent. BE OTHER THINGS SO YOU DONT HAVE TO BE AFRAID!!!! (I want to scream this at everyone who is unsure man, you can do it!!!)

Update: Ended up paying the bill myself. The numbers still work for me, just a little more cash upfront :( 

@Kristy Pedersen I own 3 SFHs in this area. Luckily I got in in 2015/2016 then one recently... The move here is to get it up to rental grade. Then rent for fair market value at this time <900/month. And then hold on for dear life. 

My values have quadrupled since 2015 and I'm now in a position to do the pricey rehab and refinance. Time was on my side. 

I am invested in this area and would love to chat more about it. Feel free to reach out. 

Rob,

Most will say that your first deal should be turnkey, in B class areas. This is truly passive if you have a good management team. But if you want to quit truckin' in 10 years, this is not an aggressive or scale-able strategy. You said it yourself, you can buy 1/year, and loans will eat up your cash flow. After 4 loans, it gets hard to find financing. So you can do this for 4 years, be in a lot of debt, and cashflow 200/house if you do it 100% correctly. 800/mo wont let you quit your job... I would still buy one of these for your first deal. Get your feet wet. Nothing wrong with a home that makes you 200/mo. 

I've had good luck buying 35k dollar homes, in C class neighborhoods. I spend 2x time finding good tenants than I spend finding and fixing the homes. The key is finding good tenants. Try to attract people who have family near by, a stable job near by, and who care about the neighborhood. They will stay long, cause less problems, and take care of the home. Master this, and you can buy one of these per year for infinity years, take on no debt, and cashflow 500/door.... then when you feel really good about your deals, take HELOCs on a few of them and now you have a personal line of credit to buy more, improve more, or to step up and get into multi-fam.

Reach out, happy to chat, 

Matt

Hi BP Team. Great news! Found a good deal, title is back, and I am ready to close!

However, I have a seller who is refusing to come to closing because of a delinquent water bill. He is insisting on "resolving" (aka fighting off) the lien before closing. I'm not confident he will persuade PWD... in a timely manner...

I understand that I can pay the bill myself, but I don't want to. Could the lien be transferred to me in order to clear title? Could I lean on my AOS, and specific closing date agreed upon, to force the seller to the closing table?

What are your thoughts?

Thanks in advance!

@Tj M.

It amazes me that HELOC is only mentioned in 2 posts here... and not in the most productive context. Let's mix in the HELOC and see what we can do ;)

If you are able to, why not pay off your propertie(s), whether it's up front cash or over time, then go get a HELOC? This way you have access to your equity at a cheap-ish rate. You are basically turning your paid off house into a bank. A bank that you can borrow from and pay back on (mostly) your terms. Ultimate flexibility... I'm no pro but my journey is below. It's a mix of free and clear properties, HELOCs, and BRRRR.

House #1 SFH: 2015, invested all of my cash on purchase and repairs, 32k total. Own it free and clear. Rented her out. Went and got a 20K HELOC from my bank

House #2 SFH: 2016, went out trying to find a home for <20k, to use "other people's money" aka the HELOC to pay for it. By the time I found #2... I had already saved the enough for the purchase price. Bought it free and clear then used the HELOC to slowly fix it up. Used rent from #1 to pay back the HELOC during repairs. Once #2 was rented I used rent from both homes to pay back my HELOC superfast. At this point, I still have access to the 20K HELOC. And I have two homes free and clear.

Then I took a mortgage on home #2. Heck, i read too much bigger pockets about BRRRR and I got greedy. I pulled a mortgage out of #2. So I took 63K out from the bank and went to work. 333/mo mortgage payment.

House #3 SFH: 2017, Bought and fixed free and clear using a portion of the 63k from the bank. It's rented out.

House #4 TRI: 2018, Bought and fixed free and clear using the rest of the 63k from the bank, + some rental income from #1 #2 and #3... It's rented out.

House #5 SFH: 2018, Bought free and clear using some rental income from house 1 through 4 and again borrowed some funds from my HELOC! Still have that HELOC, still love the HELOC.

At end of 2018 I have 5 fully rented homes, 4 of which are free and clear. Then one mortgage payment of $333/mo (from the BRRRR) and 20k available whenever i want from my HELOC. Love the HELOC. I only ever invested 32k of my own money! The HELOC cushioned me. In times when I needed funds, (roofs, purchases) I used the HELOC, and then paid it back pretty quickly with rent money. 

House #6 TRI: 2019.... under contract. For this one I am going FULL ON HARD MONEY. I'm scared but I'm confident. And I enjoy being out of my comfort zone. Guess what. The HELOC will help me again. And the 4 free and clear properties are also helping. I'm using the HELOC to fund origination fees, appraisals, forming an LLC, and for earnest deposit on this deal . I'm using equity in one of the free and clear properties as collateral for my "required 20% skin in the game". Then I'm using hard money to finance the remaining 80% of the purchase/project cost. I will refi out when it's all said and done and successfully lock down a good deal using ZERO of my money. (We'll see how this goes)

What are ya'll investing in! I'm in B- to C- areas (Brewerytown (3), Germantown (1), 54XX Market st (1)) .

Here's my cap rates: 19%, 16% and 11%, then 25%, then 8% (way below market rents). All buy/fix/holds. I started buying in 2015. 

My NOI is calculated with 8% vacancy rate, 10% repair rate, and 6% management fees + Water/sewer + tax + insurance... I have almost no vacancy so that's extra cake, and I self manage 3 of them... more cake. (I said I would accept nothing lower than 15% CAP but some inherited tenants are dragging down two of my homes.) 

My cap rate = NOI / (Cost to buy/to close/ to fix/ to stabilize)

"You make your money when you buy."  

(sorry for bragging i guess, willing to share more if you reach out)

Thanks @David Krulac. Do you have a recommendation for a probate lawyer? We're both in PA. Preferably someone who will do a free consultation to hear out the issues.

Thanks,

Matt