All Forum Posts by: Chris Soignier

How long have you owned it?     Perhaps you could put it on the market, then when you get an offer, set the closing date to cross the year threshold and offer the buyer an attractive lease term (w/ big DP/earnest money) at move-in?

Agreed, if I was doing SFH rentals, I'd be comfortable just buying umbrella liability coverage for the first 10 or so. Cheaper and easier.

 p

KP = key principal.    For recourse loans, the lead may not have enough liquid net worth to satisfy the lenders' guaranty requirements, so they'll bring in other high net worth investors to also personally guaranty the loan.   For non-recourse loans, the key principal is on the hook primarily for fraud.    Oftentimes the KP is also the default managing member in case the lead becomes incapacitated, passes away, or is voted out.

CF = cash flow, specifically the cash flow I receive from distributions.    I expect to receive enough of it within 5 years or less to replace the income from my job.

You're probably going to have a hard time raising OPM until you have a track record of successfully leading acquisitions.     For a 1st time lead, I want them to have a significant amount of their own equity in the deal.    Lenders will often look for prior experience as a key principal, esp. if you don't already have a significant net worth relative to the loan.

Finally, brokers place a lot of weight in their perception of how likely the buyer will be to close the deal.    It's a very competitive market, you're often up against institutional funds that can fund an all-cash deal.

My path is to learn as much about the business as I can as a passive, become a KP at some point, and when I get enough CF to justify quitting my day job, then I'll look at becoming a lead.    It def. won't happen overnight, but it's a big responsibility and I want to devote 100% into doing it right.    Good leads can make incredible money, bad leads can be done in one.

#1 Honesty and integrity beyond reproach

#2 Conservative, realistic rehab and ARV #'s

#3  Allow an out if the #'s provided are proven to be materially inaccurate.   This will cost you for the transaction, but should pay dividends long term if you want to  differentiate yourself

#4 Total transparency (ex. fro your contract to buy the house prior to assignment, of course) - rehab estimates, any knowledge of issues, etc.

I'm not currently buying houses, but contracted w/ a dishonest wholesaler this summer who left a bad taste in my mouth.   

If you don't give up residential, how do you plan to compete against commercial brokers who devote 100% of their time and effort to that niche?    I'm admittedly no expert here, but I'd want to hire a broker who specializes in commercial, not a do-it-all, to sell my commercial property.

I wouldn't.    He may already be stressed about it enough w/o his landlord breathing down his neck about something that may or may not happen.   Or maybe he has another job offer just waiting for him to finish this one.  Maybe he has an emergency fund which will cover rent for the rest of the lease.  As long as he pays the rent and complies w/ the lease, his employment status isn't really your business.

Why do you want smaller properties?     MF is all about efficiencies of scale, which is esp. important if you're an out of state investor needing to hire prop mgmt.    If your budget precludes bigger properties, think about raising funds w/ other investors.

Wow, what a great podcast.    Grant was informative, inspirational, and entertaining!

@Trevor Gerard , the lsrealty link is way out of date.

I don't know Brad personally, but am familiar w/ his background and accomplishments.   There's no doubt he knows multifamily - he learned personally from Del Walmsley, founder of Lifestyles Unlimited.

I'm a PIG member @ Lifestyles, but recently received a private placement memorandum from one of Brad's students.   One thing that was quickly apparent is that Lifestyles is much more passive-friendly due to their lead investor guidelines.    This deal, first time leads were getting an override, an acquisition fee, and a prop. mgmt. fees plus asset management fees  well in excess of LU standards.    None of which would have passed muster w/ LU.   I passed, and it seemed like they were having problems raising funds, likely due to charging too much for first-timers.   

However, if you're going to invest just a small amount, it may pay to find Brad's leads, since as mentioned you don't need to be a student to invest as a passive   Regardless, perform your due diligence, and be sure you understand the economics, risk, terms, conditions, etc. of whatever you invest in.