All Forum Posts by: Paul Williams

Well based on the numbers I've run - it would be roughly 50,000 profit (before taxes) after closing costs and from what I understand taxed at a personal income rate? Can you share what the tax benefits would be? 

As for the property, it is in an okay neighborhood but I do feel that I'd be able to take this money and put it into another property. It's just tough to give up that kind of cash flow. 

Thanks for the advice @Steve Vaughan!

A property was bought through foreclosure auction and fixed up with a total purchase cost and rehab cost of $80,000. The plan was to hold onto this property long term but I've had an investor make me an offer would love to have your opinion on this. Here are the details:

Purchase price and rehab costs - $80,000
Rents for : $1425/mo
HOA fees - $225/mo (covers roof, water, exterior, and garbage)
Insurance - $45/mo
Occupancy rate - 90% 
Depreciation - $2,000/yr

Originally I thought the property would be worth $115,000 - $119,000 ARV

I had an investor who saw it listed as a rental send me a contract for $135,000 and close in 3 weeks (No realtor fees). 

How do you evaluate whether to flip a property vs. keeping it longterm?

So update:

On a cash out refinance, banks require a 6 month period where your name is on the title before they will allow a refinance. 

From a refinance where you purchased with a loan - they will refinance up to the purchase amount unless you are willing to wait 6 months. So even though comps are around 105-110, they would only give me 75% LTV on the $67,500. Thus, I've decided to wait 6 months in order to gain the refinance on the appraised amount instead of the purchase price.

Which online lender did you use? I've ran into a situation where they state that you can't do a cash out refinance until you've held the property under your name in title for 6 months. Sounds like you were able to do it within the first few months. Any tips/help on shopping around would be greatly appreciated!

Sorry to have left out some of the details. Here were my assumptions before the purchase:

• Ability to get a 30 year fixed loan for $75,000 with 4.9 interest rate
• Annual maintenance costs of 1% of the property's purchase price
• 90% occupancy rate
• Annual property value increase - 3%
• Property management - I have my license and have dealt with some property management. I understand that I am giving up some of my time (freedom) but am willing to do so at my stage in life.

From what I've assumed, this will cash flow around $400/mo after expenses. I'm curious as to any tips you may have to finding the best rates/loans available. Also, what kind of documentation should I have readily available considering this will be my first investment loan and I know there a stricter guidelines for these. 

As for a 30 year vs. 15 year loan - I've heard that it is better to lock in a 30 year fixed and pay it off as if it's a 15 year (if paying of the loan asap is your goal). Open to any tips/suggestions on this. 

Thanks for all the advice, this community is awesome!

Recently purchased a condo (3/2.5, 1500 sqft) at a foreclosure auction.

ARV - $105,000
Purchase Price - $68,000 cash
Rents for - $1,200
Repair Estimate - $7,000 (Flooring & Paint)
Association Fees - $203/mo
Taxes - $907
Insurance - $50/mo

I am looking to implement to BRRR method and wanted to ask for advice.

When looking to refinance, what type of loan and LTV should I be looking for. I am aware for an investment that current interest rates for an investment would be high 4's to low 5's. Should I be looking to finance what I have in it ($72,000 and a 30 year loan?)?

Thanks for the advice!

Forgot to mention but the house will rent for $2300

This deal has a lot of moving parts but I'll do my best to cover them all. 

ARV - $345,000
Repair costs - $45,000
Purchase Price - $295,000 (Cash and Owner Financing w/ 0 interest)
HOA - $50
Location - A
Schools - A+ (private schools, public schools and the top rated schools in the state)

$207,000 will be paid in cash to pay off their remaining loan. A note for 88,000 will be given to the seller. They will have the right to stay in the home at a reduced rent - $1,600 will come off the loan every month they stay in the home and they'll pay $400 cash to cover taxes, insurance, and hoa). If they stay in the home for 4.5 years the loan will be paid off and at that time they'll have to move out. 

If they ever decide to leave the home before then, the payments will be on hold for 3 months to give time to make necessary repairs and then payments will start back at $1600/mo until the note is paid off. 

The 0 interest loan is the ONLY part that makes this deal enticing but I'd like to receive feedback to see what you all think. 

This deal has a lot of moving parts but I'll do my best to cover them all. 

ARV - $345,000
Repair costs - $45,000
Purchase Price - $295,000 (Cash and Owner Financing w/ 0 interest)
HOA - $50
Location - A
Schools - A+ (private schools, public schools and the top rated schools in the state)

$207,000 will be paid in cash to pay off their remaining loan. A note for 88,000 will be given to the seller. They will have the right to stay in the home at a reduced rent - $1,600 will come off the loan every month they stay in the home and they'll pay $400 cash to cover taxes, insurance, and hoa). If they stay in the home for 4.5 years the loan will be paid off and at that time they'll have to move out. 

If they ever decide to leave the home before then, the payments will be on hold for 3 months to give time to make necessary repairs and then payments will start back at $1600/mo until the note is paid off. 

The 0 interest loan is the ONLY part that makes this deal enticing but I'd like to receive feedback to see what you all think.