All Forum Posts by: Andrew Oliveri

I'm based in LA but I have deals in the IE that meet the buying criteria of my buyers in the IE.
I need a title company that is able to close escrow of assignable contracts for these deals.

I'm based in LA but I have deals in Nashville that meet the buying criteria of my buyers in Nashville.
I need a title company that is able to close escrow of assignable contracts for these deals.

I'm in Los Angeles and looking for triplex and fourplex properties for a house hack investment.

My question is about estimating rehab costs for the possible properties I have found.

Considering current inflation and materials shortage I'm looking for guidance in estimating various rehab scenarios.

Light cosmetic rehab

AND

Medium rehabbing - i.e. adding a bathroom or converting a garage to and ADU

Anyone have a PRICE/SQFT. guideline that they currently using to accurately estimate their rehabs??

Bear in mind that any rehabbing I undertake for this investment will be for renting the property and living in one of the units...So I will NOT be using custom, premium fixtures, etc...

I recently heard a good advice about the best way to approach a potential lender.
The advice was to state 'What it that I want to DO' rather than just stating - What I want.

In other words - Instead of simply stating that I'm looking for a loan for $500,000, it's much better to say :

'I've found a property that the seller will take $500,000 for. It needs $75,000 worth of work and then the ARV will be $750,000. Do you have anything that might work for me in with this property?'

Great advice, great approach.

Here's my question : I assume that going this route requires directly contacting lenders instead of just going to a mortgage brokers.  So I want to know how I might identify my short list of banks and lenders to approach.

Am I looking for banks close to where I live that I can walk into and introduce myself?

Feedback greatly appreciated

One of the things that I continue to struggle with is estimating rehab costs.
I often hear Brandon say on his webinars and on his IG account, is that we need to get really good at analyzing properties.

That it is important to analyze one deal every day so that we get good at running the numbers accurately...that way, when we do come across a good deal we will have the confidence to take action quickly and make an offer knowing that we have accurate numbers.

My problem is that  have not heard him or anyone else talk about how to do an accurate rehab estimate if we are not able to get inside the property.
I live in Los Angeles and when I drive for dollars and I find distressed properties that are in need of TLC, I don't have a way to determine if I am dealing with a $100,000 rehab or a $150,000, $200,000 rehab, etc...

I would greatly appreciate if someone could speak to this question because whenever I watch Brandon or another expect demonstrate how to use the BP calculator I never get a satisfactory answer about how they arrived at the rehab cost - they just seem to plug numbers.

I constantly see video of real estate investors finding a property online and then running the numbers so that they can determine an offering price to the potential seller - But never is there a clear explanation about how they determined their rehab estimate.

thanks for any help or insight you can offer.

Andrew O.

Here's a question I want to put forth regarding my getting pre-qualified.

Presently I'm putting the pieces in play to buy a duplex property or single-family home where i might an ADU in back to live in while I rent out the main house.
This will be my first deal that I am seeking a loan from an institutional lender.

My credit score is outstanding (820+) but I don't currently own any real estate.

So my question - We often hear BP investors talk about the importance of meeting local lenders, credit unions, etc. in order to develop relationships with these local lenders.
Since this will be my first deal in my name, am I better off simply connecting with a good mortgage broker rather than going to several lenders directly to shop for the best solution for me?

Your opinion is appreciated.

Focusing mostly in areas south of the 10 freeway, Crenshaw Blvd corridor... down through Inglewood and further south.

Seeking an excellent contractor specializing in rehabs, remodels, and ADU construction.

I recently heard a webinar from Fund and Grow, (a company that makes it's money by helping its clients establish themselves as 'lendable entities' such as an LLC or
S Corp. and then goes out to find their clients money and lines of credit)

They explained several concepts :

1. By establishing your company as a Lendable Entity you are establishing the possibility of banks lending you much more capital than if you did so as a personal line of credit

2. Money borrowed by the LLC or Corp that you set up will not count against your personal credit score.

3. AND POSSIBLY THE MOST POWERFUL IDEA THEY PRESENTED - Once you have established credit as a legal entity and have corporate lines of credit with one or more corporate credit cards, you can then use a service from another company called PLASTIQ which allows you to wire payments (for a fee of 2-3%) with your corporate credit card - (Like a cash advance without the immediate charging of interest)
They went on to explain that you can use your new corporate credit card which will very often include an 'Introductory low or no interest promotion' for 12 months of longer. (The same way you would receive a promotional no-interest personal credit card offer).
PLASTIQ allows for wire transfer payments to vendors (like a cash advance). 
NO INTEREST is charged if you pay it off before your credit card promotional period ends .

So here's my question : "To go LLC or Not?..."

One of the arguments we hear against establishing an LLC in California (I live in LA) is that you pay annually $800 to the State of California.

But maybe it's well worth the annual $800 charged by the state of California if it means I can establish much greater credit with banks with corporate lines of credit and use a 12-18 month interest-free promotional rate credit card offer, INSTEAD of turning to HARD MONEY where I'd be charged points AND a high interest from the moment I borrow the money.

For example, say I needed $500,000 for the purchase and rehab of a property and I was able to access $100,000 or more with a corporate line or credit. This would allow me (using the service of the above mentioned PLASTIQ) to may purchases and pay vendors without paying interest for 12+months, wouldn't this be worth establishing an LLC?

I would be able to carry a portion of the purchase/rehab cost interest-free for the promotional period rather than having to finance solely with hard money or private lenders

The idea of having access to this type of credit that is NOT hard money is very attractive but I'm wondering if maybe there are important details I'm not seeing or understanding. 

Any thoughts on this are greatly appreciated.

Best regards,

Andrew O.

General question regarding running numbers for viable BRRRR opportunities in LA.

We are all told that the max allowable offer should not exceed 70% of the ARV less the construction costs.

I would like to know if LA investors (specifically those investing in single-family and duplex/triplex properties) are able to realistically find these deals.

As an xample - Let's say a 3-bedroom, 1.5 bath home in North Hollywood is listed on Zillow for $660,000. And comps show an ARV of $760,000. And let's say the rehab estimate is $45,000.

So this would mean that the max allowable offer is $487,000. ($760k x 70% minus $45,000.) 

I have a hard time believing that LA investors are finding and buying based on this example.

I would like to know if anyone in LA doing rehabs either to flip or as buy-and-hold investments are actually using this formula. Is anyone actually able to find sellers willing to sell at this discount?

OR are LA rehab investors typically doing deals and taking a smaller margin?

And a follow up question would be :

If my target investment property is a house-hack for myself, would I be well-served to ease off of the max offer of 70% of ARV?

If I'm able to make the number work to where my rents cover or almost cover my mortgage, AND I'm living in the house as well - should I be open to a deal doesn't meet the '70% of ARV' criteria?

any thoughts are greatly appreciated.

@David M.

Thank you very much.

This was a very big help.

All the best,

AO