All Forum Posts by: AJ Exner

Quote from @Eyal Goren:

Quote from @AJ Exner:

Hey @Eyal Goren

It looks really great, thank you for sharing!

I might add on the 'deal sourcing' tab, does that include the full processing time to secure financing as well? I saw the question mark, and being that our firm focuses on that stage, I know the importance on that side of things.

Most of our 'BR'-lenders take 2-4 weeks for processing. So 'sourcing' is one thing, but the actual processing of the loan can add up to another month.

Even on the refinance, that time with appraisals and underwriting and everything, that timeline would probably need to be increased.

Hope that helps tweak it a bit

 Thanks @AJ Exner

I had put some time for a hard money lender on cell J12 - did you mean that or something else?

Based on your feedback I increased the time for refinance to 4 weeks - do you think that should be enough?

Thanks for the feedback!

Eyal

Yeah, 4 weeks is a much more accurate representation of that. I generally say to expect 30-40 days.

And yes, there are Hard Money lenders who can do your traditional short term bridge/rehab loan, as well as 30 year fixed. 

Hey Courtney,

Sorry I just saw this, so there are two ways that something like this could go. We would need to discuss where we set up funding to close on that day, which can get tricky with most lenders, or we set up delayed financing. 

Delayed financing would have you pay in cash, but then come alongside after that transaction and reimburse you the amount (~80% or whatever the LTV of purchase was) and recoup that liquidity shortly after close.

The biggest issue with doing that is tying up liquidity. If you have any kind of title issues (which can happen in auctions), it can delay the process.

Feel free to give me a call if you want to talk!

Great to hear! There are a lot of great opportunities in and around STL and my clients working in that area have found some great investment properties in and around the city.

Are you looking to do any kind of section 8 long term stuff or keeping it straightforward? Or are you thinking about Medium-Term or Short term rents on your holds?

Hey @Eyal Goren

It looks really great, thank you for sharing!

I might add on the 'deal sourcing' tab, does that include the full processing time to secure financing as well? I saw the question mark, and being that our firm focuses on that stage, I know the importance on that side of things.

Most of our 'BR'-lenders take 2-4 weeks for processing. So 'sourcing' is one thing, but the actual processing of the loan can add up to another month.

Even on the refinance, that time with appraisals and underwriting and everything, that timeline would probably need to be increased.

Hope that helps tweak it a bit

Quote from @David Ray:

Buy and hold at this point. Thanks!

 Of course, good luck!

Quote from @Sam Booth:

Quote from @AJ Exner:

Quote from @Sam Booth:

Quote from @Andrew Postell:

@Sam Booth several things to consider here:

First, there are lenders out there that will lend to a person.  If that's of importance we can talk about this further.

A single member LLC is how most of us usually start.

Creating a LLC doesn't make any difference on the Capital Gains tax...OTHER things affect this, but not JUST if the property is in a LLC or not.

And the liability thing is always "touted" with LLC formations but very few people will do all of the OTHER things it takes to provide proper shielding.  Again, JUST the LLC formation alone does not provide shielding...you have to do tons of other things as well to do it properly.  

Hope all of that makes sense.

I d love to hear about fix and flip financing to an individual! Let me know who these are.

If a property is in a LLC and then transferred to another LLC or trust then it will trigger capital gains is my understanding.

I second what Andrew says, there are definitely lenders that can lend to you as an individual, but finding them could be tricky.

LLCs can help with the liability side of things, but they can also help on the personal financial side of things as well, like Debt to Income and Personal Credit Score. By increasing trade lines and debt flows, even with that, conventional lenders will cap you at a certain point so LLCs can be very beneficial when you really start to scale.

I am not worried about the liability part at all since home owners insurance offers GL for a lower cost then the trouble of LLCs. But if I need an LLC then which type? S Corp? I ve heard on the podcast that you should never put rentals in a LLC for a bunch of reasons. Obviously big time players do to protect but for just a few rentals and especially where plans may change in 5 or 10 years it would be nice to know how to do it right.

Sure, I mean for ease, simplicity, and flexibility we tend to lean single member LLCs. I have clients that operate just fine in an S Corp, which if any lender can do one, they do the other.

Where I see it help is in the front end processing as much as anything. Whenever you have an S Corp, there are a few additional hoops to jump through to get things changed, which is where if plans change in 5-10 years, it could get a little tricky. 

Whereas with single member LLCs, you can tweak, make changes, and modify pretty readily as needed for any new or existing deal. We find it is the best all-around option, but it might not always be the perfect option.

Quote from @David Ray:

Merry Christmas and Happy New Year!

A friend of ours is helping resettle his cousins who are Afghani refugees in the Akron area. When I looked at the cost of housing there, I became very interested to purchase in the area,  seeing as several properties were in the 80k-150k range. Anyone had experience owning and renting properties there? Best established management companies?

Thanks 

Agree with James on this one, I have some clients in that area and it is a great market to get into with some good stabilized rents in combination with solid purchase prices. Are you looking to BRRR or just buy and hold?

Hey Robert,

I think focusing on the LLC as a conduit to manage liability is a great way to go. I have some clients that would actually set up multiple LLCs that manage a couple of properties, or even an LLC per property, to help offset that. Its a little bit of work on the front end, but certainly a way to help.

It does sound like a strategy that could be beneficial as you start to scale up.

Quote from @Sam Booth:

Quote from @Andrew Postell:

@Sam Booth several things to consider here:

First, there are lenders out there that will lend to a person.  If that's of importance we can talk about this further.

A single member LLC is how most of us usually start.

Creating a LLC doesn't make any difference on the Capital Gains tax...OTHER things affect this, but not JUST if the property is in a LLC or not.

And the liability thing is always "touted" with LLC formations but very few people will do all of the OTHER things it takes to provide proper shielding.  Again, JUST the LLC formation alone does not provide shielding...you have to do tons of other things as well to do it properly.  

Hope all of that makes sense.

I d love to hear about fix and flip financing to an individual! Let me know who these are.

If a property is in a LLC and then transferred to another LLC or trust then it will trigger capital gains is my understanding.

I second what Andrew says, there are definitely lenders that can lend to you as an individual, but finding them could be tricky.

LLCs can help with the liability side of things, but they can also help on the personal financial side of things as well, like Debt to Income and Personal Credit Score. By increasing trade lines and debt flows, even with that, conventional lenders will cap you at a certain point so LLCs can be very beneficial when you really start to scale.

I would think that you could just refinance it as long as you are a member of the LLC. You might need to get signatures though if there are other members of the LLC.