Posted by Bill K. - FL on April 14, 2000 at 07:51:53:
Here’s my 2 cents. Forget about splitting. Forget about holding on to unless you are a glutton for punishment. Read the horror stories of landlords on mrlandlord.com. I would look to buy, rehab and sell all of them. Since you have no cash you could: 1. bring in a partner 2. have seller finance 3, have seller lease option to you. Plus you don’t have to tackle all maybe just do the smaller properties especially if this is your first. As far as estimating rehab this comes with experience. If you know absolutely nothing then have a general contractor look over the place.
About to make offer on 15 units …Any holes in this plan? (kinda long) - Posted by Glenn(OK)
Posted by Glenn(OK) on April 13, 2000 at 23:34:16:
Finally got up the nerve to call and discuss a small house with an OUT of state owner…only to find out he has 15 total units to sell…his opening figure was 125,000…I am seeing the potential here…Offered finance with 17% (loves those odd ## ) down and 7% APR…units are mainly 1 and 2 bedroom…older , ranging from dilapidated to newly rehabbed about half of them ARE occupied.
10 units are all on one city block…1 deed and same utils so they are basically separated apartments…
4 units are in the form of 2 duplexes…needing cleaned up
1 is a SFH 2 bedroom…also needing clean up but is occupied
my initial thoughts after conferring with another investor were to…plan to keep the 10 that are all on 1 city block…tie them up with a contract and flip the SFH and the 2 duplexes for the down payment $$
I am starting with NO cash and MARGINAL credit…yes i do have a J.O.B.
my biggest challenge at this point is…trying to find a funding source for this project. and accurately estimating rehab costs…this would be my FIRST choice rather than trying to sell parts of this package to meet the down payment requirement. I would like to cash out the seller with 100 percent funds…maybe enticing him to take less…
any thoughts? one more ? how hard is it to split up units that are deeded together? is this a good or bad thing?
Thanks for all who take the time to read my ramblings:)
Offer to buy all of them on the condition that they are divided up (after all they are seperate properties even if they’re owned together) of course you’ll have to find out if there is a blanket mortage over all of them, which means you’ll have to get new financing on each to pay that off (if it’s worth it.)
Condition 2: Some properties will be purchased for cash and others either on seller financing or lease/options.
Then go out and find yourself a partner to put up the cash for the properties you plan to buy that way.
If there is equity in any of them, see about borrowing against it for the money you need to fix them up. Then give several of the properties to your partner and sell or rent the rest.
Just because this is your first (by the sounds of it) doesn’t mean you shouldn’t buy them all, as long as you get the help you need to decide if it is a good deal, and get it under the terms you need to make a profit.