All Forum Posts by: Charles Kagahastian

with cap rates on l o o p n e t . c o m between 5 and 7 how is it possible for anyone to make any profits i've currently been playing with numbers from a couple of properties and it seems like their prices always end up with negative cashflow with the standard of 20% down and a 7% interest rate. should i completely negate cap rates like MikeOH says? should i just propose a price that would allow for cash flow? or is it that these properties are just bad deals. also some of the properties i've been researching are mostly vacant and the agent will use this info as a way to sell a condo conversion. are mostly vacant properties not good for rental properties? is the short term profit just not there?

I just started playing with numbers after reading frank ginelli's book "what every real estate investor needs to know about cash flow and other calculations" and i guess you can say i am overwhelmed. The examples in the book are just that examples and they work because of that. when i plug in these real numbers i just can't seem to find any good properties when cap rates are this low. is new york commercial dead or stagnant cause from what i've read places like astoria and brooklyn as well as the lower east side have a huge market and low vacancies. i need some help please

my father said that he would loan me the money i need for the downpayment of the multi-family through the money he would've gotten from selling the house. however the timing isn't right to sell the house right now so i figured he could just do a cash out refi he would not be a partner just i guess a personal loan. so if its only a loan i figure that i would have to cover the increase in my dad's mortgage bill so i want this money to come from the NOI of the multi-family. doesn't that mean that the NOI of the multi-family has to cover both debt services? if so then i would think that the refinanced down payment would have to be considered in the DSCR...would it not. i'm still a little confused and want to know how the best way to get my downpayment. should i use my father's equity?

thanks so much scott that really helps me out. however i have a follow up question. when preparing a loan package to present to a loan officer, does the refinanced money have to be included in the loan package when projecting returns.

lemme explain my situation a little bit. i am looking to buy my first multi-family building and my father offered to use the equity in my parents house as a down payment for the multi-family building (this would be owner occupied). so in terms of loan qualification when putting together the loan package to present to a loan officer does the monthly payments required by the refinanced money affect the DSCR of the property? because in this situation i have two loans. thanks for listening.

hello all, this is my first post and i'll try to make it matter. as any first-time poster this is going to be a question. the very popular method of using equity in one property as a down payment on another property. However just to make things a little clearer, doesn't that take a lot away from the cash flow of the second property? It's basically financing the entire purchase price of the second property is it not? and does that not mean the cash taken out from a refi has to be taken into account just as much as the loan of the second property when calculating cash flows? obviously i know that it's all about the numbers and if 100% financing would allow for a positive adequate cash flow then the deal may work, but given the fact that refi does not mean free money how is it that investors can so easily use the money from a refi to buy more properties?

Thank you so much for your time and happy investing to all of you!