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$14,500 Profit on First Rehab Inspires the Whole Family

by Kim Dillard   

As an avid reader of CRE Online Success Stories, I couldn't wait to post my own! While up late at night with a new baby, I got a chance to see numerous real estate infomercials. I decided to order the Carleton Sheets course and follow the directions on how to get started.

I also did my own research and happened onto the CRE Online website. What a revelation! I now recommend it to everyone I know who is interested in any aspect of real estate investing and wants financial independence.

I also began to attend the Houston, Texas Rich Club meetings, and was bowled over by the amount of knowledge and excitement generated in one room!

I received the Sheets course at the end of May 2002 and put a contract on a property on July 6th. I worked through Coast Realty Capital, a hard money lender for financing and closed July 30th.

My husband was skeptical initially, yet went along with the plan. The property was contracted for $49,000 with another $5,000 to be paid to the seller "on the side" during the rehab process.

With an appraised ARV of $87,000, the 70% loan came to $60,900 for purchase, rehab costs, and fees. Because I low-balled the estimates for repairs, we had to come up with $7,000 at closing. Yikes! After a little sweating, we pulled some out of savings and borrowed the rest from a family member.

Being green as grass, I also underestimated the amount of time it would take to rehab the property. I budgeted two months, but it took four! I also learned how to work with contractors, and not to hire friends.

In the last month of the rehab, I began to market the property for retail sale by putting an ad in the Houston newspaper for seven days. Got one call. I put a "For Sale By Owner" sign in the front yard and got 40 calls. The house sold in three days for $94,500!

We grossed about $28,000 and netted about $14,500 in time for the Christmas holidays.

Although things didn't go exactly as planned, I learned lessons that will be truly valuable the next time around. I am looking for properties right now! More importantly, because they actually saw the process, my mother, sister, brother-in-law, and several friends are starting their own search for viable properties to rehab and sell.

My mother, especially, is excited because she is on a fixed income, yet can see a way to make money doing something she enjoys while controlling her own destiny. Thanks to everyone mentioned for all the help, and thanks CRE Online for playing an integral part in changing our lives for the better!

 
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