All Forum Posts by: Brian James

Quote from @Jordan Ray:

Quote from @Brian James:

I am 55 years old and looking to build wealth through real estate. Primarily in multi-family units 2-4 units to start, then scale quickly. There is no need to remove cash flow now; just keep reinvesting. Just doing research now, hoping to close first deal (maybe 2) before end of 2025.

Hey Brian, Great strategy! Memphis is a strong market for cash-flowing multi-family properties, especially in the 2-4 unit space. With the right approach, you can definitely scale quickly while reinvesting your returns.

Are you looking at a specific property in Memphis, or still evaluating options? I'm always involved in real estate investing with clients and building my own portfolio and would be happy to connect, share insights on the market, and maybe even discuss potential deals. Let’s make sure you’re set up for success before the end of 2025! Talk soon!

I do not have a specific property in mind and feel like I am still a few months away from making any kind of move. Need to sort out capital, strategy, markets, business structure (probably LLC). I don't want to build the ship after it leaves the port.

Quote from @Jaycee Greene:

Quote from @Brian James:

Quote from @Jaycee Greene:

Quote from @Brian James:

Actually no, I live in West TN, but the pull-down options are limited. If you draw a line between Memphis and Nashville, find the midway point and that would put you pretty close to Yuma, TN. It is a minimum 90 min drive either way. Carroll and Henderson County market is small.

I would prefer not to use all potential capital for a down payment. For argument's sake, let's say 50-60K, keep the rest for unexpected expenses or a second deal. I am trying to understand all of these financing options. I figured FHA was out because of the live-in-it requirement.

That is why I am in the financing research, capital build mode right now. I would need a little time to get the down payment in some kind of liquid form. Perhaps HELOC on current property, sale of some under used personal property, etc.

HML terms kind of scare me. Taking out 25K at 12% and needing to pay it off in 12 months, without assurances of being able to refi after a year could be tough. But there may be other HML terms that I haven't found.

@Brian James HMLs aren't for the faint of heart, but the terms you're describing relate to their fix/flip and rehab loans. Their DSCR loans are actually much closer to bank terms and rates, some are even more borrower friendly than banks. Yes, the fees are still higher, but the flexibility and increased LTVs they offer can offset that.

Are DSCR loans considered a subset of HML? I have been treating them differently in my mind.

@Brian James No, DSCR is a general term applied to long term mortgage loans on investment properties, particularly when the borrower is an LLC or other business entity. Banks and credit unions provide the same type of loan, they just don't call them DSCR loans.

Thank you for the clarification. I was planning to establish a single member LLC (my third) to represent this new venture.

Quote from @Jaycee Greene:

Quote from @Brian James:

Actually no, I live in West TN, but the pull-down options are limited. If you draw a line between Memphis and Nashville, find the midway point and that would put you pretty close to Yuma, TN. It is a minimum 90 min drive either way. Carroll and Henderson County market is small.

I would prefer not to use all potential capital for a down payment. For argument's sake, let's say 50-60K, keep the rest for unexpected expenses or a second deal. I am trying to understand all of these financing options. I figured FHA was out because of the live-in-it requirement.

That is why I am in the financing research, capital build mode right now. I would need a little time to get the down payment in some kind of liquid form. Perhaps HELOC on current property, sale of some under used personal property, etc.

HML terms kind of scare me. Taking out 25K at 12% and needing to pay it off in 12 months, without assurances of being able to refi after a year could be tough. But there may be other HML terms that I haven't found.

@Brian James HMLs aren't for the faint of heart, but the terms you're describing relate to their fix/flip and rehab loans. Their DSCR loans are actually much closer to bank terms and rates, some are even more borrower friendly than banks. Yes, the fees are still higher, but the flexibility and increased LTVs they offer can offset that.

Are DSCR loans considered a subset of HML? I have been treating them differently in my mind.

Quote from @Bruce Woodruff:

Are you sure you want to start with Multifgamily being a newbie...? Maybe get yourself a couple of SRFs to start, run them for a year or two and get some $$ profit AND (more importantly) experience. Then either keep those or sell and move up?

Just a thought....

Reasonable response. I am not a total noob to the business world. I actually had a single family rental for about 2 years and it was enough to make me swear off ever being a landlord again. Simple truth was I didn't know what I was doing.
Now I am more interested in being an investor. Back then I needed the cash flow, now I just want the cash flow and it is a big difference in mentality.
I am not looking to go big right of the bat. I was thinking 4-6 units. This would allow for some better management of vacancy rate vs single family. To generate reasonable cash flow with a single-family I think STR woudl be the only real way to go.
At my age, I want to go from ZERO to at least $10 million in assets and $250K in annual cash flow in 10 years. But I need to identify the right deals.

Actually no, I live in West TN, but the pull-down options are limited. If you draw a line between Memphis and Nashville, find the midway point and that would put you pretty close to Yuma, TN. It is a minimum 90 min drive either way. Carroll and Henderson County market is small.

I would prefer not to use all potential capital for a down payment. For argument's sake, let's say 50-60K, keep the rest for unexpected expenses or a second deal. I am trying to understand all of these financing options. I figured FHA was out because of the live-in-it requirement.

That is why I am in the financing research, capital build mode right now. I would need a little time to get the down payment in some kind of liquid form. Perhaps HELOC on current property, sale of some under used personal property, etc.

HML terms kind of scare me. Taking out 25K at 12% and needing to pay it off in 12 months, without assurances of being able to refi after a year could be tough. But there may be other HML terms that I haven't found.

The market where I live is a no go, so I am leaning towards more turn-key to start. I have NO team to speak of yet and figure I may be 3-4 months from a deal. I am hoping to have access to about $80-100K through sale of some vehicles and HELOC. Hard money loans don't seem to be in line with my strategy I like the DSCR route, but understand that would lock me in to 5+ unit deals. Learning more about FHA financing is on today's agenda. For now I just keep analyzing deals to get a feel. I am good with spreadsheets and numbers.

I am 55 years old and looking to build wealth through real estate. Primarily in multi-family units 2-4 units to start, then scale quickly. There is no need to remove cash flow now; just keep reinvesting. Just doing research now, hoping to close first deal (maybe 2) before end of 2025.