Closing on 16 unit on March 28, 2015

801 BERNICE, ODESSA, TX

PURPOSE/PRINCIPLES:  Property has equity but no cash flow, will require terms or a discounted price to take on risk.

OUTCOME: Buy at discount or obtain terms for 2-3 years, refinance out seller, hold long-term or sell depending on market conditions. 

  • 16 unit

  • ARV: $640,000
  • Cash price: $200,000

  • Repair costs: $80,000

  • Total: $280,000
  • LTV: 44%
  • Terms: 36 months

Money in pocket for Borrower

  1. $8000/mo after expenses
  2. $300,000 in equity at sale
  3. $345,000 down, sell at $645,000 in 6 months
  4. Refinance at $500,000 and pull out $155,000 cash

For lender

  1. lend $345,000 at 8% for 12 months
  2. $13,800 profit after first 6 months
  3. $27,600 total profit after first 12 months
  4. Lending to experienced borrower with 725+ credit score

HOW-TO PROCESS:

  1. LOI done
  2. DD in process
  3. CLOSE in process
  4. MANAGE
  5. SELL OR REFI 24-60 months

 

 

LINKS:

 

  • 16 units REO
  • Price: $240K
  • $225K for the note

 

  • 34 any size rentals
  • …in a 0.77 mile radius.
  • Median rent: $988
  • Average rent: $1188
  • 60% between: $722 – $1655
  • 80% between: $477 – $1900
 
PROPERTY 4.png

Story:

Seller wants $240k if he forecloses and $225k if we foreclose on the property.

 

  • The seller did a promissory note with the buyer in January of this year.
  • The buyer is 2 months delinquent
  • seller is getting ready to foreclose.
  • No financials but it needs some work.
  • Below is the seller’s response:
  • Tenant pays electricity
  • Has a waiting list of tenant applicants

 

Repairs needed:

  • Replace all the windows with new energy efficient windows
  • Redo all the water lines with PeX  Move it into the ceiling, instead of under the foundation.
  • Remodel all the bathrooms.
  • Update all the heating and Air
  • redo the outside fascia and siding
  • replace all the flooring on the lower apts with ceramic tile
  • Replace some cabinets in the kitchens
  • New entry doors

 

 


Hi Travis

   I do not have an info , but talked to Raymond who did maintenance there. 

He is the only one there because they evicted all the tenants so they could do the remodeling. 

I don’t know what they have done. 

This is what we had planed on doing, before the sale

 

  • As far as access, if Raymond is there you could probably get access I think.
  • He is now 2 payments behind.
  • We have not started the formal foreclosure as of yet but want to before the first of Dec.
  • Attorney is ready to proceed

 

 

 

@helloswat