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All Forum Posts by: Chris Bounds

Chris Bounds has started 77 posts and replied 443 times.

Post: Hard money approval without capital

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

@Maurice Horton , pretty much any hard money lender is going to require you to have cash reserves or access to cash (credit lines) to do a loan. Some will make exceptions if it is a very low debt-to-equity ratio. The reason for this is they want to make sure you can make their high-interest monthly payments.

A few alternatives options are: Opening up an line of credit, partnering with someone with extra cash, assigning contracts for a wholesale fee, and double closing wholesales

Post: unable to get a hard money loan

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

@Account Closed

Are you working with a mortgage broker or a specific bank? A broker can shop your situation around.

You can use HML and the refinance into conventional once the rehab has been completed. It will cost you more, but banks will look at a refinance differently than a purchase. That is how I did several of my rentals. The good thing about that strategy is it side-steps the 20-25% down payment requirement if you buy it cheap enough.

Other suggestions to consider: If you have to, try wholesaling or flipping a few properties to build up more cash. Use a portion of the cash to pay down your personal debt. Keep your credit accounts paid down to help improve your credit score. Done aggressively, your situation could be much better for a conventional loan in about 6 months.

Post: Houston Meetup March 2014

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

I won't be able to make this one, but I'll look out for the next planned event.

Post: Investing in Austin Tx

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

@Justin Bergen

Successful wholesalers have a systematic marketing campaign that keeps their phone ringing. By using wholesalers for your deals you are basically outsourcing the marketing part of your business. Of course, they'll take their piece of the pie when they sell it to you, but its less for you to worry about. The only way around that is to put your own marketing campaign to action which takes time and money, but if it's successful you'll find deals with excellent margins.

Post: Property Management - Houston area

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

@Eric Benzenhoefer

I hired CKR Property Management last week. They were a referral from Empire for MF properties. It was about 10% GOI for my property.

Post: first property houston texas

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194
Eric Tait thanks. I'll look into that.

Post: first property houston texas

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194
Eric Tait are repair deductibles legal in TX? I mentioned it to a local PM and he said they weren't. The other argument against them is it disincentives prompt repairs. I loved the idea before lease options were basically outlawed.

Post: first property houston texas

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

@Jerimiah Anderson I agree with Sharon's analysis.

Remember though, using the 50% rule half of your total rental income will go towards expenses, excluding the mortgage P&I. With rent at $1400/mo and expenses half of that then you have $700 left to pay mortgage P&I.

Be sure to crunch the numbers and plan for worst case situations. Do you have the cash to do the repairs and a few mortgage payments if necessary?

Post: Business and Investing Mindsets

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

@Jonathan Harris Great comments. The quote above sums it up.

Post: What Do You Think About These Numbers

Chris BoundsPosted
  • Investor
  • Sugar Land, TX
  • Posts 467
  • Votes 194

@Wade G. Be sure to factor in repair reserves and vacancy. Depending on the age of the property, 6-10% of rent is what I use for repair reserves. I use an additional 4-6% for vacancy depending on the area (how fast does it lease / turnover).

20% cash-on-cash return and a $200/mo bottom line cash flow are my minimums. Excluding reserves it comes out to $500+/mo. From other aggressive landlord investors that seems typical for rentals in the Houston area.

There are turn-key rental wholesale companies out there, but you will pay more for those properties. That effects your returns of course. Depending on your situation and goals that could be a good thing though.