All Forum Posts by: Robert Johnson

Im using a HELOC to rehab one side, and do not want to spend my capital rehabbing the other unit, which will cost 60-70k. What type of business line of credit or SBA loan would work best?

I currently have a duplex under an LLC. I am rehabbing one side with a HELOC, and the other side needs to be completely rehabbed now and the cost will run around 60k. Any advice of which type of business line of creed ti should get so I do not have to spend the capital I have in the bank?

Investment Info:

Townhouse buy & hold investment.

Purchase price: $280,000
Cash invested: $14,450

This unit was purchased as a trust sale, and has since been remodeled, we currently occupy the unit. The unit has recently appraised for $605,000.

What made you interested in investing in this type of deal?

Buying a home in West hills would hold its value.

How did you find this deal and how did you negotiate it?

It was a trust sale on the MLS and I new the listing agent. I was able to get my closing cost paid for.

How did you finance this deal?

5% down conventional.

How did you add value to the deal?

Added laminate wood flooring throughout most of the house except for the bedrooms. Removed all the wall paper and painted the entire house, remodeled the kitchen and updated various places of the house.

What was the outcome?

An increased of over 300k in equity

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I represented myself in the transaction.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Carmichael.

Purchase price: $270,000
Cash invested: $67,500

Duplex in the city of Carmichael. 2/2 on each side, both sides have a 2 car garage. Sits on a corner lot, with a Starbucks and home depot down the street.

What made you interested in investing in this type of deal?

I love multi family properties because when one unit is vacant, you still have the other side covering the rent.

How did you find this deal and how did you negotiate it?

I found this deal on the MLS and I represented myself. Thinking back, I cannot remember what I negotiated as it was back in 2014, I negotiated a small concession, and has the seller pay for termite.

How did you finance this deal?

25% down conventional financing, investment property.

How did you add value to the deal?

Rehab has not occurred yet due to long term tenants however rents have been raised slowly. The market has increased nearly 2 fold since purchased.

Lessons learned? Challenges?

Looking back I would have brought in my own tenants and rehabbed after it was vacant. I would have did some creative financing if I know what I know now.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I represented myself in this transaction.

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Sacramento.

Purchase price: $415,000
Cash invested: $83,000

Duplex in the city of Roseville (Sacramento). One long term tenant paying below market rent, and one new tenant paying slightly above market rate. 5 year annualized return 17.78% and Cash on Cash return is 2.12%
Purchase cap rate was 4.91%. A recent comp as of November 2021 sold for $505,000.

What made you interested in investing in this type of deal?

Sacramento is one of the hottest markets in the country, and according to CCIM, has been a market with one of the lowest vacancy rates a good cap rates. Renters and would be homeowners are priced out of Oakland, San Francisco and are relocating to Sacramento. I love investing in multi unit properties.

How did you find this deal and how did you negotiate it?

I found the deal off market, I brokered the transaction representing both sides, the seller would either list on the open market and list for $430,000, or sell off market to me for $415,000.

How did you finance this deal?

25% down conventional loan purchased as an investment.

How did you add value to the deal?

Upon one of the tenants moving out, my wife and I put in vinyl wood tile flooring in the living room, cleaned the unit, did some cosmetic repairs, added a washer and dryer, and rented it out for $1684 per month.

What was the outcome?

Market rent for the rehabbed unit.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

I brokered the deal and purchased myself.

@Jim Pellerin thank you for your advice

@Andrew Hogan thank you for your comment

I need a 2-4 unit and need to generate $1500-$2000 or more if possible in passive income, then eventually BRRRR.