Underwriting Process
Conservative Underwriting Is The Key To Success
At Ideal Builder, your success is our priority. We only present investment opportunities that we would personally endorse. Our underwriting team follows a rigorous approval process, ensuring precise figures by comparing with MLS listings. Many of our investors spend less than projected and sell for more than expected, which keeps them coming back!
So What Kind Of Deals Are We Looking For?
Great question! Ideal Builder provides you with a competitive advantage by concentrating on high-demand areas and off-market properties that have potential for value enhancement. Every property we present is priced below market value in rental-friendly neighborhoods, making them ideal for generating consistent passive income. These properties are situated in low- to middle-income areas with immediate equity. This strategic focus, along with our thorough underwriting process, guarantees a reliable exit strategy for you.
Our 4-Point Targeting Method
Solid Location
- Low to middle class desirable neighborhoods
- No war zones
- No rural areas
Type Of Property
- Single Families and Multi Families
- Duplexes, Triplexes and Quads
- Mobile Homes and Townhouses
Condition
- Value added older homes
- Need some repairs
- Neglected or vacant
- Turnkey for rentals
Price Range
- Below market value
- For Fix & Flips, we try to stick to ARV of the median price where it’s perfect for first time home buyers.
- For rentals, we stick to at least double digit CAP rate.
Our Underwriting Rules
Once we identify the specific areas and types of properties we want to target, we begin working to present you with deals. This is how we analyze each opportunity to ensure the numbers align with your exit strategy.
Location
- Same subdivision
- Do not cross any major roads, rivers etc.
- Within 1 mile, preferably up to 0.5 mile
Characteristics
- Same beds
- Same baths, 1.5x max
- +/- 200 sqft
- Older houses to older houses
Adjustments
- Similar types (Bungalow, 2 stories, historic)
- Similar siding (Bricks, vynil, wood, frame, block)
- Similar features (Pool, garage, carport)
A Winning Formula!
We always assume a full renovation just as you would if you bought a property from an auction! Only this time you have HQ pictures and transparent details about the property.
We always try to show a wide range of comps and try to provide at least 5 solid comps that we feel comfortable with.
For rental properties, not only do we look for solid rent rates in the area, but we make sure that you still have some equity. After all, you’re making money when you’re buying.
