I’m proud to say that this property…was free. It cost me $0. I was able to buy an income generating property…in Los Angeles…for nothing. Here’s how - enjoy! Add me on Instagram: GPStephan
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24 months ago, I began looking for an income property around the mid-city area of Los Angeles. I liked this area in particular because it was close to nearby transit, surrounded by several large new developments, it was only a 15 minute drive away from the beach…and most importantly, it was one of the few areas in Los Angeles where property prices were still selling under $1 million dollars.
After 6 months of searching, writing offers, getting out bid, and otherwise not finding a single opportunity - the perfect spot came up. And the price? Listed for…$585,000.
So I made them an immediate offer: I’ll pay full price, guaranteed to close…under the condition, that the owner accepts it immediately.
I bought it for $585,000…I put $150,000 as a down payment, and I got a loan for $438,000 to cover the rest.
Then, I spent another 2 months, and roughly $80,000 fixing it up. This meant, when I was finished, I had invested a total of 2 months worth of time, and $230,000 into a property.
So I went to the bank, and I told them I wanted to do what’s called a REFINANCE. This is when the bank will give you a new loan on the property, based on the CURRENT value of what it’s worth - NOT what you paid for it.
And the market value was very favorable to me…an appraiser determined the market value of my property, for a remodeled 1920’s Spanish duplex, was now $780,000, just shortly after I bought it.
So given the new value, the bank is able to give me a mortgage of up to $585,000, and give me back $145,000 in cash.
My current mortgage is $438,000
The bank’s NEW loan is $585,000
The new loan pays off the old one, and that leaves us with $145,000 left over after paying some transaction fees.
That was in 2017. NOW…I can do it again. I went from bank, to bank, to bank…to get a quote on a new mortgage. I was able to get at 3.75% fixed rate mortgage for 30 years, on a cash out refinance. The bank appraised it for $965,000. And given the new $965,000 value, I was allowed a $675,000 mortgage - leaving 30% worth of equity still in the property.
That meant…after all was said and done…not only do I have $290,000 worth of equity in the property…but I now SAVE an extra $200 per month on my mortgage interest payments, and I got back ALL of the $230,000 I invested, leaving a total out of pocket cost, to buy this property, of $0
Like I said, the first refinance got me back $145,000…and the second got me back $85,000. That was everything I had invested in this property…and it’s basically free real estate.
In real estate, your ideal situation is that you can control 100% of an income-generating asset…by having as LITTLE of your own money invested in it, as well. This gives you the opportunity to INVEST your money in other, higher generating opportunities - than keeping your money tied up in an asset where it isn’t actively working for you.
This is the name of the game in real estate…it’s to find a good deal, put your money in, make it work for you, refinance your money back out, keep the property…then go and use that money to do it again. And it’s by doing that, over and over and over again, that you can soon build up an empire of real estate, for free, by just…smashing the like button.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
The YouTube Creator Academy:
Learn EXACTLY how to get your first 1000 subscribers on YouTube, rank videos on the front page of searches, grow your following, and turn that into another income source: https://bit.ly/2STxofv $100 OFF WITH CODE 100OFF
Get 2 Free Stocks on WeBull when you deposit $100 (Valued up to $1400): https://act.webull.com/k/Vowbik9Tm5he/main
My ENTIRE Camera and Recording Equipment:
https://www.amazon.com/shop/grahamstephan?listId=2TNWZ7RP1P1EB
24 months ago, I began looking for an income property around the mid-city area of Los Angeles. I liked this area in particular because it was close to nearby transit, surrounded by several large new developments, it was only a 15 minute drive away from the beach…and most importantly, it was one of the few areas in Los Angeles where property prices were still selling under $1 million dollars.
After 6 months of searching, writing offers, getting out bid, and otherwise not finding a single opportunity - the perfect spot came up. And the price? Listed for…$585,000.
So I made them an immediate offer: I’ll pay full price, guaranteed to close…under the condition, that the owner accepts it immediately.
I bought it for $585,000…I put $150,000 as a down payment, and I got a loan for $438,000 to cover the rest.
Then, I spent another 2 months, and roughly $80,000 fixing it up. This meant, when I was finished, I had invested a total of 2 months worth of time, and $230,000 into a property.
So I went to the bank, and I told them I wanted to do what’s called a REFINANCE. This is when the bank will give you a new loan on the property, based on the CURRENT value of what it’s worth - NOT what you paid for it.
And the market value was very favorable to me…an appraiser determined the market value of my property, for a remodeled 1920’s Spanish duplex, was now $780,000, just shortly after I bought it.
So given the new value, the bank is able to give me a mortgage of up to $585,000, and give me back $145,000 in cash.
My current mortgage is $438,000
The bank’s NEW loan is $585,000
The new loan pays off the old one, and that leaves us with $145,000 left over after paying some transaction fees.
That was in 2017. NOW…I can do it again. I went from bank, to bank, to bank…to get a quote on a new mortgage. I was able to get at 3.75% fixed rate mortgage for 30 years, on a cash out refinance. The bank appraised it for $965,000. And given the new $965,000 value, I was allowed a $675,000 mortgage - leaving 30% worth of equity still in the property.
That meant…after all was said and done…not only do I have $290,000 worth of equity in the property…but I now SAVE an extra $200 per month on my mortgage interest payments, and I got back ALL of the $230,000 I invested, leaving a total out of pocket cost, to buy this property, of $0
Like I said, the first refinance got me back $145,000…and the second got me back $85,000. That was everything I had invested in this property…and it’s basically free real estate.
In real estate, your ideal situation is that you can control 100% of an income-generating asset…by having as LITTLE of your own money invested in it, as well. This gives you the opportunity to INVEST your money in other, higher generating opportunities - than keeping your money tied up in an asset where it isn’t actively working for you.
This is the name of the game in real estate…it’s to find a good deal, put your money in, make it work for you, refinance your money back out, keep the property…then go and use that money to do it again. And it’s by doing that, over and over and over again, that you can soon build up an empire of real estate, for free, by just…smashing the like button.
For business or one-on-one real estate investing/real estate agent consulting inquiries, you can reach me at GrahamStephanBusiness @gmail.com
ITS FREE REAL ESTATE
Clickbait title. Great video. Great advice.
IT'S FREE REAL ESTATE
Someone slept his way into an old ladies will 😂😂😂
Ok, I feel like he is overcomplicating it, but lemme see if I understand…
He's claiming $0 because: ($675k current loan – $438k old loan) – ($150k down + $80k reno) = $0
Essentially, you can forget the initial expenses and mortgage and just imagine he did $0 down and $675k loan.
Really, he put $230k of his own money into the house a few years ago. He wanted the money back (free it from the asset) without selling the house. So, he had the bank give him a loan using the house as collateral to get $230k in his pocket.
umm whats the website name of the free houses
self-indulgent BIIAATCH
I hate you
you a lyin sack of **
Correct me if I'm wrong, but by conducting an appraisal and increasing the loan value, didn't he increase his monthly mortgage payment?
You still don't own it. All you did was increase its value and get better loans. You still have to make payments. This is confusing your hardly buying it. The banks own it. They own your debt. They own your payments. They own your money for 30 years.
sheesh you didn't tell them you were basically robbing them at that price. You exploited their foolishness. Sounds like a pretty unrighteous thing to do.
couldn't you do this way better if you bought it with cash to get a steep discount. Then improve it. Value it again. Let the ding dong say it's worth way more than buying price + fixes+labor. Then sell it again. Do they really not ask for receipts to tally the cost? They just go "huh looks like that other place that's that price over there, I guess its the same, hur dur."
im gonna have to watch this again. I have no idea how any of this works. equity is how much of the home you paid off? Refinancing is uh giving yourself a bigger loan? So borrowing more money? uh Why would you borrow more money. Just pay it off for the small amount then sell it later for the new amount
Had to watch it twice to fully understand but basically, because of the refinances you got your money back fast and now there's a renter in there paying off your mortgage for you. That's smart.
What about the cost of the mortgage payments over time… did he have a renter in the unit or was he eating that cost too?
But now you owe 970 k, don’t you ??
You work for 40yrs to have $1M in your
retirement, meanwhile some people are putting just $10K in a meme coin from just a few months ago and now they are multimillionaires.,,,,
Wouldn’t you still need to pay interest on the loan every month, meaning some out of pocket money?
But if we can’t do that yet
you just got lucky!
It's free real estate
Summary: Graham in the video describes how they were able to purchase an income-generating property in Los Angeles for $0. They explain that they searched for the property for six months and finally found a 1920 Spanish duplex that was priced at $585,000 but they believed was worth $675,000. The speaker had an advantage because they were the first one to see the property and there were no other offers. They made an immediate offer of full price with the condition that the owner accepted immediately, which the owner did. The speaker notes that the owner and real estate agent did not have a good understanding of the property's value and that the speaker's strategy was to use leverage by being the first one to see the property.
Note: For entertainment purposes only.