All Forum Posts by: NA Jones

We are about to start our first flip and were thinking of putting a sign in the yard or hanging a banner on the porch rails with sales information...

Having a hard time coming up with the main message...  Coming soon?  Under construction?  Renovation in process?  Anyone have any suggestions?

Do you soft-market your rehabs while in progress?  What's your plan of attack? 

Fantastic!! :)

Thank you @NA Rumsey 

 :)

Read this: http://www.investopedia.com/articles/mortgages-real-estate/11/fha-minimum-property-standards.asp

Pretty far, actually.  A good agent will help you determine what qualifies.  A lenders definition of livable is very different from my own ;)  Stay away from major defects and mold - a good foundation, working mechanicals, a toilet, and a stove are pretty big requirements ;)

I've seen it work out successfully :)  Just not for the faint of heart..

In our market (I'm licensed in MD and deal primarily in Balt/Harford/Cecil counties)  seller help towards closing costs is practically expected.  I recently received a contract back that was just at asking price and 6% closing costs help.  I tell my sellers to factor in 4% for closing costs average because the fact is, buyers ask for subsidies.  When doing the math on our first flip, I factored in 4% buyer help as part of our selling costs to make sure it would be profitable.  My preferred lender will allow up to 6% help from sellers towards closing costs.

If I were you, in your current situation, I'd find a 2-4 unit in the "livable but needs upgrades" category... make sure that it's in good enough condition to finance using an FHA loan. Put 3.25% down and have the seller pay for as much of your closing costs as they are willing. Then you can put in all the sweat equity that your heart desires without the restrictions of using specific contractors.

You might want to confirm that with your lender.  Or someone here will come along and add further detail :)  I don't personally have experience with how the draw system works. Whenever I explain the process as I know it to my retail clients, they turn pale and ask me to take them to a house that's not a fixer upper ;)  

Shot in the dark, but both carpenters / handymen that we had lined up for our upcoming rehab have been pulled onto different projects.

Anyone have any recommendations for someone good fitting this description in the Cecil County / Delaware area?

As I understand it, if you want to do things like flooring, tiling, painting, carpentry, drywall work, cabinetry, etc. yourself then the 203k loan is not for you.   

When you use the 203k loan, you have to submit the bids from the contractors for the work to the bank.  The bids have to come from licensed contractors.  The bank approves your plan, the contractors do their work, then the bank inspects and lets the contractors get paid.The bank wont let you make draws until the work is complete to their satisfaction, so those contractors need to understand they get paid fully at the end of the job.  It's easier to work with contractors who have experiencing doing work with these loans.

You might be able to use the 203k loan to get the property up to "livable" standards using licensed contractors, and then do the finish work yourself -  but you won't be able to include the cost of materials in your loan.