All Forum Posts by: Brandon Penn

@Mike Freeman So the seller of the building sold the property to me and acted as the bank essentially. The deed transferred to me, and they created a mortgage against the property in the amount of 65k one a 30yr amortization schedule with a 5 year balloon payment, but gave me an option to renew every 5 years until I refinance or it is paid in full. They originally were to have the place all fixed up before I purchased it, but were having trouble with laborers and asked if they gave me 6k if I would fix it myself. It's only going to cost me about 4,500-5k to fix up so I took them up on their offer. First unit is done and 2nd unit will be done before Jan 1st

I've always been a strong supporter of buying a multi-unit and living in one of those units. Best way to get started in your investment career in my personal oppinion.

So this year I actually planned to not buy anything. I purchased a large portfolio last year with a lot of vacancies and work needing to be done so I had just planned to stabalize and position myself for 2021.

Despite this I actually acquired 2 duplexes! One was at 213 E 28th st that had a pretty bad fire. The owner finance the whole deal as well as a rehab budget. Once we are finished we will refinance with a bank. 1 unit is done and the upstairs is about 2/3 there.

The other deal which I was pretty excited about was 822 E 25th st. I manage to pick that one up, and have the seller form a mortgage so the deed is in my name. They rolled all my closing costs into the mortgage, and gave me a $6k check at closing! We are doing some cosmetic stuff and should be rented out by Jan 1st

Your next step should be to find someone who is successful in the business whether it is an investor, or real estate agent that deals in investments. Figure out how you can bring them value (usually as an assistant) so that you can learn from them. You have a huge advantage with starting out so young. You could offer to help them, and instead of pay have them teach you everything they know. If you can manage to get paid as well that's all the better, but my first year in real estate I worked 60-80 hours per week and only made about 10k for the entire year. The knowledge and relationships I built during that time though are what positioned me for the rest of my career.

Personally I would refinance the properties (preferably a equity line of credit if you can find a bank to do it). Then use the money to make cash offers for other properties. Rinse and repeat until you are at the size you want to be, all the while your debt is being paid down by the tenants. 

Is the election going to really change what you are going to do with your business? If so then wait, but I just don't really see how it is going to matter when it comes to your rental business unless you plan to liquidate and leave the country. If you are still going to have a rental business in the U.S. no matter what the outcome of the election is then definitely buy another property. Interest rates are at historic lowes and we never know when they are gonna go back up. Lock that cheap debt in now.

Very untrue. If you are looking to expand as quickly as you can, you need to leverage as much as you can. Now having said that you should also keep a large reserve of cash to help weather any storms that may come to pass in the next 10 years. There is absolutely no way I could have gotten to 116 doors by paying cash. They are all very leveraged but cashflow, and I don't take any money from them so that they pay their own debt down quicker and go to repairs. By the time i'm 45 they will all be paid off from tenants' money.

It all depends on your market. That is about right in my market. 10% monthly, 1 month rent to lease out an apartment, and $100 to do lease renewals. If you are not going to manage yourself then try to find one of the best managers in your area. Even if they are more expensive than others, they can save you a lot of money in the long run.

It's different for everyone. All depends on your market, your comfort level with risk, and what your goals are. I personally am 100% leveraged in 95% of my deals. I don't use any of my own money. The big risk with that is if something goes wrong (like COVID). I'm not in a position to just let half my portfolio not pay rent for a month or two, I would be washed out. On the other side I have some friends who own a fraction of what I own, but they make more money monthly and are better positioned in the event of a crises because what they do own is completely paid off. To expand quickly you will have to leverage property.

In Erie, PA we have both SFH as well as duplexes that sell for 50k an are in decent areas (blue collar). I also manage properties if you are out of town or down have anyone close to the area. Shoot me a message if you are interested