Posted by Mike Oldfield on May 09, 1999 at 21:14:05:
Tie up the proerty for 30 days then go get a $25,000 line of credit which should be easy with your other investment income. Dont tell the lender what your up to. Just tell them that you want some flexibility to take advantage od other opportunites as they come up. When the line closes go get that cash flow Yahoo!
If the deal doesnt fly you will still have the line for other deals. If it does you will restore with your cash flow from 8 units in only one year and you can do it again.
Shame on you. You should have a line established already! Now you know why.
Good Luck
Mike Oldfield
Too much too soon? - Posted by Dave
Posted by Dave on May 09, 1999 at 20:29:23:
I’ve just purchased 4 townhomes in one swoop for $80k per unit. They appraised for $86k per unit giving me instant equity of $24k. The cash flow from these units is about $1000 per month with property management in place. I put down 5% ($16k). They are about 5 years old and are in excellent shape with a great rental history. My dilema is that the seller of these townhomes wants to retire and has several more for sale at the same price (won’t budge) and same general location (near a university). If I could find 95% financing I think I could swing buying 4 more and gain another $24k in equity and another $1000 per month cash flow. The seller would do a 10% carryback but raise the price to where I would gain no equity (I like gaining equity).
Am I being too aggresive in thinking about buying more? I think its a pretty good deal but I also want to be sane and not do something stupid. I would appreciate feedback from any experienced investors. Thanks in advance.
Dave
Re: Too much too soon? - Posted by Bill Gatten
Posted by Bill Gatten on May 10, 1999 at 16:05:19:
Dave,
Remember the old joke about the young bull and the old bull? The youngster spies a heard of cows and suggests that he and the old guy race like crazy down the hill and [kiss] a couple of the best looking ones. The old bull looks at him a little condescendingly and suggests that if they WALK down the hill instead, they’ll likely be able to [kiss] them all.
I think the story could apply in this case: although this is not to imply that you would have any more of a penchant for kissing cows than, say… a Brad Crouch might.
Bill Gatten