All Forum Posts by: Chris Pike

Hi Matt, I am in the process of interviewing different local banks as well. I am interested to see any replies you get on this feed. A couple I like so far are Pinnacle Bank and Metro Phoenix Bank. Metro tends to do more commercial lending and Pinnacle does both Residential and Commercial. Definitely worth checking both of them out!

Hi Bryan, I am a broker here in the Phoenix area. I personally own multifamily property surrounding the Downtown Phoenix area. I would be more than happy to be of assistance. Please feel free reach out to me at any time. I am best reached at my cell phone, which is listed on my profile. You can also message me on BP, whichever is easiest. I look forward to speaking with you!

I’ve got a great lender who could help you out. His name is Dominic Mancini at Guaranteed Rate. If you are interested in connecting with him, just message me and I will get you his contact info. I actually utilized the FHA Home in 5 grant to purchase my first Triplex last year. It is a great program to take advantage of for down payment assistance! If you have any specific questions I may be able to help you out as well.

Hi Kurt,

What type of properties are you looking for specifically?  Multifamily or single family residential? 

Also, what areas in the Valley are you looking?  Cash on cash returns will vary drastically depending on the neighborhoods and asset classes you are willing to work with.

Let me know a little more information and I may be able to help you out.

Great point @Dave Foster! I honestly believe a 1031 exchange is going to be the best solution for her, as it will accomplish her goal and she seems to be somewhat on board with the idea as well.  I know she would prefer to become a passive investor, does anyone happen to have recommendation on passive products that investors can exchange into?  @Lauren Speidel I am not too familiar with DSTs, any additional information on this option would be greatly appreciated.

Thank you all for your input!

@Dan Schwartz that is what I was thinking as well.  It is just a small 1,600 sq.ft. home in Glendale that was built in the 60's.  She could not have racked up that much of a recapture bill.  I feel that she thinks that the bill will be bigger than it actually will be.  I have tried to present this fact to her.  Although, will keep trying to in conjunction with referring her to her CPA...

@Matt K. Working that idea with her.  Have urged her to speak with her CPA/Financial Advisor.  That way she could exchange to a more convenient property closer to her and easier to manage...

@JD Martin exactly.  I can understand that she wants to limit her tax liability, but she has definitely made her fair share of money over time.

I have urged her to speak with a CPA/Financial Advisor regarding the ability to 1031 the property.  

Also mentioned the idea that she could carry the not to avoid paying such a large capital gains bill.  Although, not sure if it would work out in conjunction with me wholesaling the property as my potential Buyer would want to flip the property to an end user who would most likely get a new loan and pay her note off... 

Would she still have to pay a capital gain if she carries the note and then her note is payed off from another Buyer?  Never had experience with this before, but I am assuming the answer is yes...

I have found a deal that I would like to wholesale in Phoenix, AZ.  I want to help out the Seller as best I can with her situation, although I am in need of some advice in how to best assist her.

The owner is interested in selling the property, and is willing to sell it at a price that I feel is a great deal.  Although, she is concerned that she has owned it for so long as a rental, and has depreciated the asset so much, that she feels her tax bill on the captial gains will be so high that she will actually lose money when she sells the property.

The owner inherited the property back in 1979 with no mortgage on it.  Then she proceeded to depreciate the asset for the full 27.5 years available.

Any tips or ideas to help her out?

@Aaron Cullen It is important to give bad comps and why they don't work to provide the appraiser assistance in determining market value.  When an appraiser is reviewing comps, a bad comp may appear to be a legitimately good comp for your property even though it is not. 

Let's use the "Too many cat's, smell" example.  A comp in your area was in good condition, showed great in pictures, although the Seller had a lot of cats that created a foul order in the property.  This odor caused many Buyers to pass on the property, and in turn it sat on the property for longer than average causing the property to sell $10,000 lower than it should have.

When the appraiser is reviewing the MLS and sees the pictures of the home, it appears to be in good condition. It is of similar size and location. It is a viable comp for your property... The appraiser may not take the time to reach out to the agents involved in the sale and ask why the property took longer to sell than other homes in the neighborhood. In their mind values may be lower than they actually should be based on this comp.

This is just one example... This situation could happen for a variety of reasons.

You have to be proactive and make a few quick phone calls to agents who sold properties in your area and ask them for background on the transactions. You will be surprised at what you find out about properties and what occurred during the transaction that affected the final sale price, and many times these issues are not easily discovered by reviewing the MLS.

When you provide the bad comps (with explanations) along with the good comps it also shows that you are legitimately putting in effort to assist the appraiser/save them some time, instead of just telling them the value the property should be appraised at.  It helps position you as adding value to the appraiser instead of telling them how to do their job.

It is VITAL to provide a few words in writing why the comps don't work for the property in this step.  This gives the appraiser a quick reminder.

I like to use red marker for the for bad comps and green stars for good comps for subconscious associations.

I hope this helps.