All Forum Posts by: Allan C.

@Francois Guerrier some people are not in wealth building mode but rather wealth preservation. The incremental effort and risk associated with more properties is not worth it.

@Gabriella Vehrs if the CPA or lawyer were good at their profession they would not want to run your LLC. Sounds like you are looking for an office manager or an assistant.

@Ryan Becker be aware that embassies charge by number of signatures notarized like other notaries, but their cost is typically $50/signature, thus can add up to $500-1000 for loan docs. It can also take you hours waiting since some embassy notaries thoroughly review the docs.

What I typically do when purchasing from overseas is to assign POA through the embassy to someone state-side. I only need a couple of signatures notarized that way and my trusted POA can more conveniently complete the loan doc execution.

@Jeremy Fields deposits collected electronically and I do not sign lease agreement until deposits are received.

@Serena Tillman you'll need to understand how to perform an IRR calculation. Simple CoC does not give you a clear understanding of investment fundamentals if appreciation potential is high. You also do not properly account for time value of money without calculating IRR. Excel has an IRR function that is straight forward to use.

Joe, I generally agree with your position, but you should also recognize that alternate circumstances exist and other folks valid arguments. You are all disputing technicality and semantics, and often limited in perspective by the markets that you are familiar with.  

Oftentimes one's primary residence is not an asset per the mathematical proof-point above. Unless - you live in a high appreciation market.  There have been a number of times where my net gains realized from sale of a primary have exceeded 0, and even returned a rate of 20+% on my DP. Most markets do not appreciate in this manner, hence I agree with the general position you have taken, but the alternate scenario exists. I have seen a number of posts from you always arguing that primary's are not assets, but that is not unequivocally correct.

I also side with those who say you have to pay for a roof, whether it's rent to a landlord or mortgage to a lender.  You may not achieve great returns on your DP, but you are building equity vs paying off someone else's mortgage as you often like to say.  The only real incremental cost for owning vs renting is paying closing/commission when you exit. A person just has to assess whether appreciation+principal reduction can offset transaction inefficiencies to decide whether owning a primary is an asset or a liability vs alternative use of the money.

For the assets held in entities the lender requested personal guarantees for entity members. Yes this may seem excessive, but given current environment it provides them a layer of security on their loan. 

Lender underwriting factors property performance (debt cover, LTV, etc.) as well as personal finances. While PFS includes income, it's more about net worth rather than annual income - i.e. NW > loan value

@Matt Brown. Yes, I’ve come across repair requests on conventional loans for safety and health related items.

@Navid A. Rates will be a function of loan size sometimes. Portfolio lenders I’ve connected with are in the 3.5-4.5% range. However, most of the ones in the lower range have non-negotiable positions on personal guarantee.

@Joseph M'Mwirichia less than 1% does not necessarily mean returns cannot be as OP suggested. He may have some amount of appreciation built into his underwriting.