All Forum Posts by: Andy Collins

Is a certain investment in any course good, it really depends on your situation (assuming the course is a good one)

If you have $2M sittinig around your wanting to start buying notes with (or real estate), spending $16k or whatever probable isn't a bad thing,,if you have $25k to invest, then you may want to wait until you have more to invest.

I am always shocked to hear people say (or write), they just spend thousands for a real estate course, but actually they don't have any money to start investing.  Read books, read message boards etc while you are building your cash position (assuming cash is needed for notes/buy and hold etc),,,,if your wholesaleing, then it might be a different story, but if you want to "invest' then dont spend all your cash on one course and leave yourself nothing to invest,,,

I'm not saying that education isn't important, it is, but dont' spend all your cash,,save and start your education in a less expensive way

Just have your friend consider you a contractor, they 'manage' the property but you work for them,,,unless you do something really dumb I doubt anyone would ever care.

I can't go hire a PM firm without them having the right license, but I can hire anyone I want to oversee maintenance, etc

It really depends on your situation, normally $2-$4 Million is plenty, however if you have a LOT of assets, you might consider a bit more,,each extra million gets cheaper.

You have to think about what is a potential loss, and what you have to lose.  

If you have $4 Million in an umbrella, your pretty much covered (however if your worth $20 Million I might change that answer.

One of the main things your buying is the insurance company paying for you defense if there is a lawsuit,,,so get an umbrella,,,if you own rentals and don't have one your asking for trouble.

go ahead and get the HELOC and pull the cash out, park it in a checking account for a couple of months.

If you wait to pull it out, when you go to get a mortgage they will want to see where the downpayment came from, and will look at your last two bank statements.

If the money appeared during those two months they will want to know where it came from,,,they will NOT approve the loan if the money is borrowed.

They bank will want to know where any money that went into your accounts during those two months came from,,,they don't want you to borrow the downpayment.

Again, "park" the money in a checking account a few months  ahead of time and it won't be a problem

A hard money lender will lend based on the value of the property, normally if you buy a house that will be worth $150k for $100k, it will need some rehab to be worth $150k.

Let's say that rehb will cost $15k,, let's say the hard money lender will lender you 66%  (to make the math easy)of $150k, but you have to pay not only the cost of the house, but you have to put $15k in escrow.

At closing the hard money lender brings $100k (66% of $150k) to the table, you bring $15k plus closing cost. You must escrow the rehab cost, because the HML is lending based on the value after the rehab,  

make sense? 

@Kimberly H.  you can cash out a rental property at anytime IF its in the first four mortgaged properties, so no 6 month rule, however, if that would be mortgage #5, you must follow the 6 month to finance rule.

If you have a rental property with a lot of equity, and you have 4 mortgages, refinance and pull the cash out of that property before you buy the next property, or you won't be allowed to pull cash out.  (you can still pull cash out of your residence even with 5+ mortgages)

One thing most people don't realize, is they will look for ANY mortgaged properties,,I was getting my fourth mortgage, but bought a 5th house with hard money while I was closing on #4...,, they discovered it (I had purchased after I filled in the loan application for mortgage #4),they said that required mortgage #4 to be counted as my 5th mortgaged property, so I had to follow th guidelines for 5+ for mortgage for #4 and all future mortgages (make sense?).

Any property with a loan on it is considered to be a 'mortgaged property' and will count toward you 1-4 or 5-10, even if its not a conforming mortgage.

I think where people get confused is are you 'refinancing" (say after using hard money) or did you pay cash and want to finance.

If you paid cash and want to finance do exactly as @Kimberly H.  described and refinance quickly,,you only have 6 months (I believe this only applies to 5+ mortgages).

If you are refinancing sometimes you have a waiting period, but I have only seen 3 months seasoning required, to refinance,,two totally seperate things.

Talk to a mortgage broker that specializes in working with investors ,,they will walk you through it.

My broker told me of someone that thought they had to wait 6 months after cash purchase and now have to get a commercial loan

all you have to do is look at $664 in rent and paying $100k for the property and you know it won't work,,no reason to go any farther unless you want to see just how much you will lose.

If neither of the other parties want to buy you out, your just going to have to hold it, and the way its structured, I doubt they will buy you out.  Family involvement always complicates things.

The few times I have bought something 50-50 I put a clause in that if one party wants to name a price,, the other party can decide if they want to sell their half of buy the other out at that price..

I never offer a round amount, I offer $34,750, or something like that, I want them to think I really put a lot of thought into that figure, not "well, how about $30k"

It sounds like at $35 it may be a real deal