PROPERTY overview: - Class D- property that was neglected and very distressed - termites, bad roof, no heat or AC, bad wiring and plumbing - Original plan was to remodel for a rental (would have lowered the rehab costs by perhaps $5k) but a visit in Jan '19 changed our plans - Upon joining NoteSchool in Jan '20 we flipped to selling this house and holding the note - We did the demo and gutted it and used our contractors to add a new roof, added HVAC, repair termite damage, new electrical, new plumbing) and remodeled the entire interior - Highly stable workforce neighborhood with long term home ownership and few rentals - Low crime, excellent elementary and middle school within the community - Purchased the property in 2017 using money out of pocket and a small 2 year note and which we paid off prior to closing - At the time of sale (July '20) we were at $88,770 (in the property) = $58,250 (purchase) + $30,500 (rehab)
NOTE TERMS overview: - Sales price of $145,000 - PBB Buyer, D-F Qualified, $4000 down, escrowed T&I - Note Price $141,000 which we papered using a Title company as $98,750 (sales price to lower tax basis) + $46,250 (repair cost) @ 6.5% for 360 months - PI of $891.22 - Secured a PLEDGE at the time of closing for $40,000 for 4 years at 6% to recoup the rehab costs and 10k above that - We plan to secure additional Pledges when this one expires as well as consider Partials
FINANCING overview: -$88770 - funds in the house+$4000 - down payment+$40000 - Pledge+$141,000 - 30 year Principal over time+$179,838 - 30 year Interest over time-$45091 - Pledge payments over time ======================== +$226,977 Profit
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