4352 Leeheights Blvd. Clevleand
Los Angeles, California

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Objectives:

Nick L. of Los Angeles, California came to Blue Moon Capital in hopes of diversifying his existing investment portfolio that was comprised mostly of land. He wanted to leverage his cash to invest into property out of California knowing that properties in his area were priced too high and would hinder him from achieving his financial goals. Nick, having lived in California for most of his lifetime, was quite familiar with the theory of negative cash flow due to LA’s high priced real estate. For this reason, he decided to first purchase a lower-priced property from Blue Moon Capital in Cleveland. • Diversify portfolio with residential real estate • Start at low price points • Break Even

Investment:

After the $26,000 scope of work in property rehab was completed, Nick’s lender ordered an appraiser to walk through the property and complete a final after rehab appraisal. Based on the completed property rehab, the lender’s appraiser valuated the property at $110,000, which was $1,000 less than Blue Moon’s projection. Nick refinanced at 80%* of the $110,000 value, his home loan was for $88,000 and he still received 20% equity of $22,000. *Please note current Blue Moon property refinance values are 75% of the final lender's appraised value.

Transaction Details:

Blue Moon Capital conducted approximately $1,000 of due diligence of inspections, 2 subject-to independent appraisals and a scope of work on Nick’s behalf to determine what this property’s after repair value could be.

Timeline: