All Forum Posts by: Alexander Felice

that's when people get in trouble, when it gets too easy. Like an addict who can "quit this stuff at any time", it's very easy to become overconfident about one's skills and get cavalier with underwriting or required reserves, specifically because buying does get so easy once you get some experience. 

Luckily, that doesn't apply to anyone on this forum  

Skepticism is healthy

Cynicism is not 

imo

;) 

Cap rates are compressed right now, and mania is in the air. 

I just sold a property that didn't make money to someone who paid far more than me. Maybe rent increases will save him, but there is nothing in my market that would suggest such a thing to happen. 

Everyone is a playing a different game. Some people need to make big returns, some people just need to spend capital, some people have access to different debt, some people need to show losses. Some people are willing to overpay for a deal just to say that they closed something on social media. 

Everyone has different reasons for buying

Business credit doesn't work like personal credit, it's no where near as useful for a bank.

For small loans, under 1MM, many lenders won't even bother pulling business credit. Even at 5mm loan size it's most irrelevant (in my lending experience)

For commercial lending what matters more is: 

1. Capacity - Can you and/or the property repay the loan 
2. Capital - do you have money for downpayment, operating capital, and reserves
3. Collateral - what does the bank get if you default
4. Conditions - what are the terms of the loan
5. Character - who are you, what's your experience, can you successful implement and operate this deal

if you go to NETWORK you can search for hard money lenders.

https://www.biggerpockets.com/...

this is the highest rated hard money lender on BP (and someone I know personally who is a standup fella)

If I were HIM

I would give you equity and cash flow equal to your investment in the deal

a fee for bringing the deal

and pay you retail market cost for managing the property. 

Local lender is most appropriate for something like this, shouldn't be too hard if you have healthy historicals and equity

once you collateralize your properties into one loan it will become difficult to separate them back out, though not impossible

This really depends on the property, the lender, and your experience.

commercial lenders are generally far more flexible compared to a traditional fannie mae mortgage.

If you want to get into a property with no money down, one way is to find a place with a STEEP discount. For example, if you're buying at 65% LTV then a bank might give you the loan with no downpayment.

I'm a photographer, for this there is a lot of overlap surprisingly. 

I have to be able to see the future to get the right shot, just like when I buy a deal

Both requires patience over years to get good at

Both are 95% people driven businesses

Lots of real estate inventors are egomaniacs who love being on camera 

In vacuum this sounds good, but risk is more complicated than this. A wise investor will be conservative during the peak of the market cycle when prices are high and margins are thin (now), and become very aggressive during deflationary periods when prices are low and margins are high.

Be adaptable, don't box yourself in, the game is long and ever-changing.