Monday, February 28, 2011

Transactions #6,7, and 8 of 52 in 2011

February started out as a slow month, but it closed with a bang with three similar transactions in just three business days.

All three transactions were private money refinancing of properties that we already own. Here is how it works:

Step 1: We paid cash for all three properties in December or January using our own funds
Step 2: We fixed up the houses with our own funds
Step 3: We rented the houses (2 out of 3, still working on #3)
Step 4: We did two CMA's on each property and averaged the two
Step 5: We borrowed 75% of the property's CMA value
  • Borrowed funds from three different lenders. Two split two houses, one funded the 3rd
  • 5 year term (one has an option to extend 5 more years)
  • Different financing structures for each, but all have yields targeted at 10% or more
  • ALL have positive cash flow even AFTER debt service, management fees, taxes, vacancy reserves, insurance, and maintenance reserves
This is a real win for everyone. Interested? Let me know! We are always looking for new financial friends to work with.

No comments:

Post a Comment