All Forum Posts by: Charlie Fullerton

Yeah I calculated the 10% interest using $156k cash out, ~$4k for refinancing charges rolled in. I would buy another rental property, but I typically look for 12% CoC return, if this is costing 10% it really isn't worth it in terms of accelerating cash flow. I would need to find an amazing deal which is possible, but harder as we all know. Yes rate would change after 5 years. Also have a 10 year option but that is another $110/month P&I.

Would you do this?

Rental Property Value:  $900k

Current Mortgage:  $467k,  4.1% - 30 year fixed @$2,317 Monthly P&I

Current Cash Flow:  $3,700/month (~41% margin)

New Mortgage: $630k  5.4% - 5 year Lock @$3,900 Monthly P&I 

New Cash Flow: $2,100/month (~21% margin)

Additional Interest per year - ~$15,000

Total Interest on cash-out: 10%. . (70%LTV = $160k cash out)

Can't find HELOCs on rentals right now. I mean that's a high interest rate to beat to justify the pull.  That's approaching private lending rates.   Would need to get 20% return on new investment to really make a significant bump in cash-flow.  I typically like to get about 12% return.  

Looking at ways to leverage equity to scale without having to give up the low, long-term fixed rate on the primary. Thinking private money and BRRR may be the more efficient way to go at this point. Could use this property's equity to secure private lending and then free it up after stabilization.

Thoughts?

Hello Investors! 

1.5ML acquisition + Finders Fee 

Please message me for more details. 

@Greg Dickerson Great advice, Thanks! 

Hello BP family, 

I am looking to acquire my next deal and my realtor is not having much luck on the MLS. I have tried, With little success building relationships with some local wholesalers and people who have access to REO properties. But I figured I would throw up a post on here with the hopes of someone seeing it that has an off market property in or around the Boston area? I am looking for multi family buy and hold property (4+ units) - Value add preferred - 650-700K max budget - Please Message me the details - Thank you!

Happy Investing, Charlie 

Hello,

I’m looking to build a relationship with wholesalers working in Boston/ South of Boston. I completed a flip a couple years ago in Braintree. And closed on a small apartment building in rockland.

I am currently looking for my next deal and have not had much luck on the MLS.

Please reach out if you have off market deals.

Thank you, Charlie

Hello All,

I own a 6 unit apartment building in a town just 25 min outside of A major east coast city. The town has a nightly parking ban from dec 1st to April 15th.

You can only imaging the hardship this causes the tenants as my building does not have sufficient off street parking for all of the cars.

I’ll be honest, When I bought the building 3 years ago I was unaware of the parking ban. But for the past 3 winters I’ve had an arrangement with a neighboring business that allowed my tenants to park there overnight. However the business just had to shut that down because others were abusing the privilege. I have began the process of reaching out to other nearby land/ business owners to find parking.

I was wondering if anyone has dealt with a similar situation with a town that has such a ban? any tips or guidance for trying to push back to have the law revised?

TIA - Charlie

Not sure if anyone else considered this.   But shouldn't taxes come into consideration here?   For example, my 6 unit building cash-flows very 

well.  At some point this year, once I meet my reserve, I'll be cash-flowing ~$4300 month.  If PM fees are tax deductible, wouldn't that help a little via deduction at tax time, and result in lowering the cost of PM.   Thus slightly tilting the time/money equation in favor of using a PM?    

Hello -

So my monthly income vs. expense worksheet looks like this on a 6-unit rental property.    

Income:         $8200 (full occupancy)

Expenses:     $2910 (includes 10% for vacancy & 10% repairs, utilities, trash, taxes, insurance, landscaping)

Debt Svc:      $2615

Profit:           $2674 (pre-tax)

The reserve is currently approaching $30k.    

I am thinking once at $30k, to stop setting aside the vacancy and repair ($1640), and add it to the profit to be 

used to pickup the next rental property.    I think $30k, is more than enough to cover any emergencies that 

may pop up and cover a vacant unit for 6-7 months (which is highly unlikely in my market).  If something pops 

up, I then tap into the $30k to address it & start setting aside the vacancy/repair $$ again until reserve is back 

to $30k, then begin scraping off the difference for more investing.   I originally was thinking of building up to 

about $50k, but the more I think about it I'd hate to have excess $$ sitting idle for any longer than it needs to. 

Does $30k sound like a reasonable reserve for a 6 unit building in fair shape to those of you that are more 

experienced?   I feel as though it should cover any major repair that may come up.   I think this would be a 

good strategy to begin scaling.    I am new and have owned this building for about 10 months.   Am I missing 

anything?  Can anyone think of a better scaling strategy?  

Thanks

Charlie

Hello Folks -

Just want to run a situation by everyone here and get some thoughts.   I just bought a multi-family in tenant friendly MA.  One tenant still has not paid September rent.   Spoke to tenant and was told Sept rent should be coming, there was loss of child support, and rent payments will be back on track for Oct 1st.    Tenant has also applied for rental assistance and has a hearing date coming.   This lease is month-to-month (TAW) so I can simply terminate that lease for Nov 1st.   But not sure if tenant would resist and force a prolonged eviction process.   Also not sure if that is wise given the winter months are around the corner which are not ideal for trying to rent an apartment.  

I do not intend to accept rental assistance.   None of the other units are on rental assistance.   My objective is to move the building in the other direction with improvements and rent increases to get higher quality tenants.    So ultimately I want this tenant out.    

This is my first experience dealing with a non-paying tenant and I wonder what strategy I should pursue.

1.   Because winter months are coming, be flexible, collect as much rent as I can through January, then terminate the lease.   

2.  Proceed immediately with termination of month-to-month lease, out by Nov 1st.   See if tenant cooperates.  

3 . Proceed with immediate notice to vacate for late rent to try and force rent payment, and then ride out as #1 above.

4.  Try the cash for keys route in conjunction with #2 above if necessary.   

Obviously I am looking for the quickest and cheapest way to get this done.   I have no idea what type of tenant this is yet.   I don't know how cooperative they will be.   Financially it would be good not to have to deal with this until after the New Year, but I realize I am kicking the can down the road and there are no guarantees how much rent I would get between now and then.   It may be best to bite the bullet, begin the process immediately, and be prepared to have an vacant apartment through the new year at least.   I could do some updates during that time and raise the rent.    On the other hand, if the tenant does deliver the rent and we can get through the winter, then I would be in a better position from the financial and rental demand standpoints.   Unfortunately, I just got the building and have not had a chance to get all my policies / procedures / forms /etc. into operation.    I didn't learn about this situation until closing.   

Any advice, based on your experience is appreciated.  

Also can I legally tell tenant that I won't be accepting rental assistance?   I know you can't tell an applicant that, but can you tell an existing tenant that or is that discrimination as well?  

My instinct tells me to just get it over with, terminate the lease (#2 above) and be prepared for the worst if tenant resists.   

Regards, Charlie