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Feb 25

Colorado Springs Foreclosure houses, time to buy one?

Colorado Springs Foreclosure houses, time to buy one?

Dear 401K Manager,

 I was wondering if you would be willing to sign a 3 year performance guarantee on my mutual funds and my rate of returns?  I recently met a real estate agent in Colorado Springs who described to me a scenario where I could get a rental tenant in an asset I own and have them pay me a fixed amount over a 3 year period.  I was wondering if you could do that for me?

With my free time I have searched Colorado Springs Foreclosure Houses and have found many great deals out there.  These homes do require some work, however there is an abundant supply of skilled contractors in need of work.  Again I no expert, but by my math calculations I have determined I can get a ROI of at least 10% on my money.  Basically this real estate agent in Colorado Springs, presented to me this scenario.

Colorado Springs Foreclosure Houses

Remodeled Kitchen

Buy a home for $100,000.  Put in $15,000 in work into the home, mostly cosmetic updates like new appliances, tough durable tile in the kitchen, bathrooms, and entry way.  A good durable carpet, a fresh coat of paint, and some new interior 6 panel doors.  Finally address the mechanical issues, if any, like the Furnace and water heater.  My initial investment is $115,000 for this house in foreclosure.  I have been told by independent property managers that my (asset) home will rent for $1100.  That is a yearly return of $13,200 before expenses.  So I get a return of $13,200 a year on my $115,000 investment.  That is a ROI of 11.47%.

I then spoke with my accountant who told me the tax advantages are big with a rental home, especially when it is purcased from a list of Colorado Springs Foreclosure HousesHe said to speak him directly and get tax counsel before claiming anything.  He mentioned things like legitimate business expenses, depreciation, mortgage interest deduction, closing costs, lower tax rates on rental income.  Again, I am no expert, but this sounds very intriguing.  Could you summarize the tax advantages of my 401K?  I know there are some, but are they this good?

Colorado Springs Foreclosure Houses

Remodeled bathroom

Hopefully this letter finds you well and enjoying your day.  I am wanting to discuss this with you further and see what your thoughts are on the concept.  I was wondering does your firm offer any self-directed IRA’s?  Perhaps some sort of investment vehicle that allows me to buy and hold Real Estate?  Please let me know.

Sincerely,

Your 401K client

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