A No Money Down Deal! - Posted by Rolfe
Posted by Rolfe on April 08, 2000 at 24:44:02:
Offer accepted! A no money down deal. SFH, foreclosure (I’m buying from a wholesaler), vacant and boarded. This will be my 6th rental property, 12th renovation, all completed without any of my own cash.
Selling Price: $41,000
Renovation: $25,000 - $30,000
Project Costs: $66,000 - $71,000
Renov FMV: $90,000 - $95,000
75% L/V mtg: $67,500 - $71,250
Cash Flow: About $200 per month
Increase New Worth: About $20,000
The refi mtg will pay back all of my costs, which is how I’ve done all my deals. At refinance, none of my cash is left in the project, with 20% - 25% equity created by the rehab.
Terms: $41k CD @ 10%, interest only payments, 13 month term, no prepayment penalty. Seller will also finance construction, adding my construction draws to the CD balance, up to a total (initial purchase plus construction)of $75k. Draws from the seller will be paid monthly. If I borrow $25k over the project, I owe him $66k at refinance. Points for the entire loan will = 10% of construction amount, or about $2500, paid off by the refinance closing.
Finished four last year. This is my first purchase in 16 months! Feels good to be back on the street.
Good Luck! Rolfe