All Forum Posts by: Shadman S.

Let me just start off by saying how thankful I am for BiggerPockets. I found the property on the marketplace, learned a lot from the topics and discussions and of course have used the calculator to analyze the deal. I'm excited to be in contract and just wanted some feedback and any advice you guys can give me on the process and where I should be careful, what I should look out for, etc.  

Just a brief overview of the property: 2 family property, completely gut renovated. 7 BR/2BA - 4br duplex and 3br first floor with access to huge backyard from both apartments. Contract at $220k, comps show similar properties anywhere from $250-280k. 5 minute drive away from NJIT/Rutgers, low crime residential area.

On the low end, I should be able to rent it for $3000/mo. After expenses, that'd leave me at about 13-17% COC returns of 20% down payment + closing. I live about a 45 minute drive away and can manage the property myself.

Appreciate the help, feedback and support!

@Adam K.

Seems too good to be true, right? I checked out the basement - only 1 entrance. 2nd "exit" is to a backyard that has no access to the curb since it's a fully attached property. The only way into the basement is through the garage, and it's about 6 feet below street level. Not sure exactly how legal that is, although the basement was rented out room by room.

Hard money doesn't seem like a viable option for this purchase as purchase price will likely be within 85% of market value. Paying origination, closing and refinancing might leave me paying 30% of purchase price out of pocket when the dust settles.

I'm tempted because the rents were good. However, when you take into account that the basement really shouldn't be rented and isn't legal (only 1 window, no ventilation for stove - there's a hole in the basement celling for the stove to attach a vent).

Should I even put in an offer knowing I'll only be able to finance? Thanks!

Thanks for your response @Mindy Jensen. It's not a problem for me to live there. I know that's the condition to obtain a FHA loan so I can do that. I'd be renting out the other rooms I'm not living in so I have no out of pocket expense.

In regards to the closing time, it seems going FHA will be an issue since it's a longer close time. If it is in contract, can she legally back out because it's taking me too long to close and keep the EMD? Alternatively, can I try to get a conventional owner occupied mortgage with ~10% down, for perhaps a 30 day closing?

Thanks for your patience and advice! Trying to get my first deal done.

Hi BP community!

First time posting here but I've been following the BP community for a while. Found a deal in NYC, in a relatively stable area. Next to a hospital, businesses. Lady is selling because she bought another house and tenants are already moving out. It's a 2 family with a legal basement, 3/2/3 layout. Basement needs some minor cosmetic work but that's about it.

Asking $580k but wants "cash buyer" (quick closing - within 30 days). I can make an offer of up to full price as I'm preapproved with either an FHA loan or conventional. I'm thinking FHA since it'll give me the ability to put a lower down payment and put the rest into a second property. I'm still relatively young (25) so I'm trying to get as many properties under my belt as possible.

Rents are 2200/1800/1800. Expenses would be $4000 tax, $3000 insurance, heating approx. $1800. I'd be putting approx. $60-70k all in if I went the FHA route and $115-$120k if conventional. I would be managing it myself - live about 20 minutes away.

Please advise if I should pull the trigger. I'm leaning towards yes considering its a reasonable return for NYC but also don't want to be over my head.

Thanks in advance!