All Forum Posts by: Andre S Walters

Im a newbie but again I am looking to build relationships and if portfolio lenders are smaller lenders than the conventional (Wells Fargo, Chase, etc)--I would prefer to have a working relationship with portfolio lenders.

I have aggressive goals, but I also understand the necessity of building a team and have a good network.

I hope that make sense and answers your question.

Originally posted by @Marty True:

@Andre S Walters welcome to REI. What is your goal in building relationships with portfolio lenders, as opposed to (any) lenders? Usually when you get specific like that, there is a specific goal attached so it would help the community to better offer advice if you can be more specific with your goals.

I am pursuing triplexes and fourplexes.

I want to keep my budget/loan under $400,000.

Originally posted by @Account Closed:

@Andre S Walters What kind of portfolio loan are you looking for?

Originally posted by @Jason D.:
The part that you might be mistaken about is that it may not take any of YOUR money, but it takes a good amount of SOMEONE'S money to make a it work. A hard money lender isn't going to loan you 100% of the money you need. In most cases you will need 10's of thousands of dollars in cash to make a deal work. If you don't have that cash on hand, you will need to partner with someone who does, or find someone willing to lend/give it to you.

Originally posted by @Matt Crusinberry:

@Andre S Walters 

I want to start by letting you know up front that I have not viewed the recent BP webinar that you are referencing. However, with that said I am familiar with the strategy that you're inquiring about. Although, there are several different avenues you can take to obtain a property (i.e. SFR, duplex, triplex, quadplex.... etc.) using other people's money (OPM).

Some things you may want to keep in mind is what are you giving the lender in return (e.g. higher interest rate on short term loan, a percentage of the property after you pay them back, or their money and a percentage return in a specific time frame.... etc.). This all plays into the property you buy via value adds to make the property worth more (sweat equity) or how your able to obtain the property (found a great deal, the property is being sold below market value). Finding the deal is what's important at this time.

The bank (long term lender) is only going to give you a percentage of what the property is worth, or what they call loan to value (LTV). I found this to be typically around 70%-80% of the property's current value. This means you buy a house for 100k and it's only worth the 100k, the bank or long term lender will only give you 70k-80k to re-finance. If you find a property that you buy for 50k put 20k into fixes and you bring the property up to market value of 100k, then you get all your money back and maybe a little more (deal dependent); thus allowing you to pay off the previous lender. Keep in mind the other expenses as well: closing cost, removal of bad tenants, points on loan, and the many others that are specific to that property or lender.

Learn the market, find a deal, find an investor, buy the deal, work the deal (put in renters at market rents), re-finance with long term lender, pay back investor, and then repeat. I hope this helps and answers at least some of what you were seeking to find. PM me if you have other questions, or search BP as there are many with significantly more knowledge than I have. Good luck to you...

Originally posted by @James C.:

Andre,

Ok... the premise here us that the deal is REALLY, REALLY, REALLY GOOD.  Now those deals come around rather infrequently. When you CREATE one, then the money will flow there. 

It requires a modicum of study, a dash of guts and a heaping helping of support.  That having been said, if you find the deal, the money will follow.

If this is your first deal, then definitely get some support in terms of the business side of things. Stuff like running numbers on rents and expenses,  cost to fix stuff, and most importantly the overall condition of the property. 

You will have some false starts, head scratching, and maybe some sleepless nights.  In the end, if you have a good plan (you do have a written plan, right? ), and a good process with some support you should be ok.

Good luck! 

Jim 

Originally posted by @Cara Lonsdale:

Originally posted by @Andre S Walters:

HI, Sorry to be  a complete newbie investor...But would be the best way to find distressed sellers who have already given their foreclosure notice?

My County Assessor records??

If your county has recorded docs available for searching, then Notice of Trustee Sale (that's what a foreclosure is called) should be there.  The notice is first given 90 days prior to the sale, so Sellers have 90 days to sell, redeem, or get in contact with the lender to make arrangements.  Sometimes the lender will delay the sale by another 30 days if there is a contract pending, or longer, if the Seller has filed bankruptcy.

My County Assessor records??



Originally posted by @Cara Lonsdale:

Auction.com is a servicing company that facilitates trustee sales in different markets.  Most of the properties on the site are getting ready to be sold for ALL cash at trustee sale on the steps of the courthouse.  The dates and times are listed by the property along with title reports and property info.

Then, you phisically attend the auction, pay a $10K deposit for your bidding #, and bid on the property or properties that you want to buy.  If you are the winning bidder, they keep the $10K and put it toward your purchase.  Then you have 24 hours to come up with the remaining balance.  Traditionally this is an all cash process unless you can find a hard money lender who can fund in 24 hours.  

There are other properties on the site that already went to trustee sale and reverted back to the lender (usually because they coudn't get anyone to bid high enough to pay off the loan amount owed), so now they are bank owned.  Those go up for auction, and there is an online auction held where people can bid.  This is ALSO a cash process, but SOMETIMES there will be financing offered.  Those properties are CLEARLY marked on their listing page.

The key is to be COMPLETELY CLEAR on what you are bidding on, and make sure you able to pay within the time frame given.  Otherwise, you will lose your $10K deposit.  Ouch.

If you want a crack at a foreclosure, and pay for it with financing, try approaching distressed Sellers who have been given their foreclosure notices, and see if they want to sell.  These are given out 90 days prior to the trustee sale.  You can search recorded docs in your county to find these.

I hope that helps.