All Forum Posts by: Becca F.

Hi Osazee,

Ace's course program is $495 and he offers products a carte such as a spreadsheet to analyze potential rentals for $40. Sam's program is $6000 and has lifetime access to his video courses. That's very pricey and I could use $6000 towards a downpayment on a property. Both of them have a lot of free videos on Instagram and Sam has many videos on YouTube. I'm still getting used to all the terminology: CAP rate, cash on cash return, DSCR (debt service coverage ratio) and how to analyze properties.

I pulled out money from a cash flowing rental (did a cash out refinance) to help me pay for a major renovation for a single family home. I also did a HELOC against this property owned free and clear. I didn't want to finance it but if I didn't my savings account would have taken a bit hit - the renovation cost a lot more than the original estimate since all the electrical wiring was old. I will have one tenant in soon and will need to get some roommates for my tenant in order to start cash flowing paying off the HELOC. I'm looking to possibly do future purchases in Indiana since I already have a property manage there. I've also heard Ohio, Kentucky and Tennessee are also good markets. With California I'm thinking Central Valley past Tracy into Modesto or Fresno (I don't know anything about those areas and if they are good rental markets, just brainstorming).

I'm seeing a lot of investors say they use Other People's Money, which is usually private lenders or hard money loans. The private lenders gives them a loan, do the rehab, rent it out then refinance at the appraised value of the home (mortgage would be about 75% to 85% of appraised value). This seems to work well with lower priced properties like in the Midwest or the South in the below $200,000 range so pretty much nothing in the Bay Area. I was messaging a realtor and he had a motivated seller in the East Bay (San Pablo) but the house was $649,000 - I saw the pictures but didn't see the house in person but it look like a house with a lot of potential. That would be a lot of money to finance. I'm also concerned with being over leveraged. If I have too many loans, won't a bank say no? How are investors financing 20 properties? If the tenants don't pay the rent or major repair costs come up, isn't that risky? 

Thanks for your help.

@Jenny Perron

What areas of Kentucky? I've heard good things about Kentucky as a rental market. I live in the San Francisco Bay Area and own a rental house in the Indianapolis metro area. I bought the house for a very reasonable price and am getting decent rental income. My investor friends who bought property before 2010 in the Bay Area are cash flowing nicely. I made the mistake of buying at the peak of the seller's market in 2019 (my previous primary residence) and I wouldn't cash flow but break even at best on my Bay Area property. It's also not landlord friendly in this part of the Bay Area. I'm trying to sell and take whatever proceeds I get to invest in a better property, mostly likely not in California. I'm a beginning investor and getting used to all the terminology and how to analyze if a property would cash flow. To me Indiana, Ohio and Kentucky seem like great rental markets.

@David M.

@Andy Sabisch

Thanks for the information. I'm still trying to figure out all the terminology: CAP rate, cash on cash return, etc since people have different ways of analyzing a property and whether it's a good purchase and will have good cash flow.

@Ricardo Hidalgo

I appreciate the advice. My property manager who is managing my out-of-state rental (Indiana) owns duplexes and an apartment building. He's been a good mentor so far.  I know a few experienced realtors in the San Francisco Bay Area although properties are expensive here. I know two realtors in the Indianapolis area - I think the Midwest is a really good rental market since it's landlord friendly and home prices are much lower than California. As far as realtors, would they charge me a fee for finding and analyzing deals especially if they're spending a considerable amount of time helping me?

@Andy Sabisch

I appreciate your feedback. Sam Primm has a lot of videos on YouTube, TikTok and Instagram with information available for free. Not to vilify Sam, but I do think he wants people to be successful in real estate and I did message him back and forth but the mentorship program is pricey to me. The hook in the webinar is the success story of a young guy who had zero net worth and 2 years later has 25 rental properties worth millions (I forget the exact number but I think at was at least $10 million). 

They kept talking about hard money loans and private lenders and how some people are closing deals with 1 to 2 properties or 10 to 20 deals a month  for some people. To buy 10 properties a month is a lot to me, even 1 property a month which adds up to 12 a year is quite a bit. The rep on the phone said rehabs usually take 2 to 3 weeks and are usually cosmetic in nature and curb appeal and they usually don't go with properties that have major structural problems. This sounded too fast to me. 

I'm trying to be cautious about rental properties and taking on too many loans seems risky to me.What if the tenant can't pay? How are banks letting people have 20 mortgages? I think I will utilize the information on Bigger Pockets and find local real estate investment groups instead of spending the $6000. You made a great point that investing isn't a sprint. 

This is kind of a late reply. I am wondering this also. I attended Sam Primm's free webinar and got on a call with his rep. I'm not sure if I'm allowed to mention the cost of the mentorship program but it's $6000 so less than the $10,000 programs. He talked a lot about private lenders and Sam would help me evaluate potential rental properties. I hear a lot about people using private lenders instead of their own money- it's still debt that I owe in addition to the bank loan. 

I own 3 rentals and have a mortgage on one and a HELOC on another (soon to be rental). I'm hesitant about taking out more and more loans - it's starting to sound a bit risky to me but this seems to be how to acquire more rentals from witnessing other investors. I don't see how a bank would think I'm crazy for taking out another mortgage on a new rental property.

@Will Kaehler  Hi Will, I'm also wondering about Elliot with Ace Properties. I like his Excel template - I think it's $40 to purchase and may wind up buying that. I'm using my own rough spreadsheet to calculate rental property expenses and income. I currently own one property that's cash flowing and recently renovated another property that hopefully will have tenants in soon. I haven't taken the course. It looks like the 8 hour course is $495.

I've been following Elliott@Invest with Ace for a while now and Sam Primm on Instagram recently. Invest with Ace's spreadsheets look really clean. He offers his spreadsheets and information in a la carte form.  I attended Sam Primm's webinar and was on a call with one of his reps. He talked about using private lenders to help fund rental property purchases and using the BRRRS (Buy, Rehab, Rent, Refinance, Scale) method. With the mentorship program, the private lender (Sam in this case) would lend me the money to buy a distressed property, then the rehabbed property would be appraised and then the lender/bank would give a loan based on 75% to 85% of the appraised value. Someone would hand hold me with buying properties with the mentorship program.

I've heard a lot about using Other People's Money such as private lenders and hard money loans. I currently own 2 rental properties with one that is cash flowing and one that I just recently renovated - I'll have a renter in there soon but will need more tenants so that I can see a good amount of cash flow. I'd like to expand my portfolio but finding properties is difficult and I don't know if a bank would approve me for anymore loans and right now I don't have the cash to put 25% down on more investment property. I own property in the San Francisco Bay Area and my current rental that's cash flowing is in the Midwest - definitely think that the Midwest is great for being a landlord whereas California is more friendly to tenants. 

Is it worth the money to go through a mentorship program? What the the pros and cons of using private lenders? What's the difference of hard money loans and private lender money? Has anyone gone through the Faster Freedom mentorship? 

@Moira Baggett This is what I did also. I bought an umbrella a policy. I called my lender on my first rental property about 2 yers ago about having it under an LLC. They said I would need to refinance it. Other investors I've known with anywhere from 1 to 5 rental properties said they didn't do LLCs. They said the filing taxes and the paperwork associated with LLCs would be complicated and expensive. There's no way I'd refinance a property now to a higher interest rate. I have 2 rentals now solely owned by me with a possible third rental (trying to sell this property right now) and another multi-unit co-owned with four other people. I'm wondering if umbrella policies offer enough protection over LLCs. Also do I have to get a separate LLC for each property?