All Forum Posts by: Curtis Rouse Jr

@Justin Thompson

Congrats on wanting to jump into MFR's! I don't know if you have already chose a market or plan to stay in your own backyard but I look for 7 factors (population growth, job growth, diversification, landlord friendly, business friendly, familiarity and rising market cycle). Once you found the market it comes down to analyzing as many deals as you can possibly look at (l've built a financial model with an example on my website if you need help) and see what makes the most sense (I look for at minimum a 10% COC return). Once you got the deal and with only roughly $18k to invest, you need to start reaching out to your circle (family, friends, colleagues) and bring that money together because all you need is 25% - 35% of the agreed upon price. Come up with an operating agreement (lawyer) and plan on managing the deal and you are off to the races. This is a very high level approach, but this should help you get started. Best of Luck and PM if you need anything!!!

@Devin A Hanley

What I did when I first started was google every bank and credit union in Georgia and start going down the list and call every one until you find someone that lends for mobile home parks. Once you get a yes, you will need to let them know the purchase price, size, NOI and your experience for them to really take you serious in the beginning. They want to see that you have done some intial leg work prior to calling them. I would also recommend getting recommendations from the bankers if they know someone that will lend on your deal. I own apartment communities and was actually just looking at a little over 100 unit mobile home mark near where I stay in Lawrenceville, Ga today. I like mobile homes parks because they cash flow like crazy, but on the other hand I love the apartments because when I go to sell I'll get a bigger bang on the exit. I've built a financial model if you need help analyzing any deals (example on my website) so just PM at any time. Best of Luck!!!

@Chris Snyder

You need to be very careful looking for 95% - 100% LTV and in todays market, I don't know of any bank that leverage this high unless you have like 20 or 30 years experience. With a highly leveraged property meaning higher payments, the banks are not going to take that kind of risk because that's how they got in trouble with the market collapse back in 2008 and they don't want to take back the property as they aren't in the real estate game. Best of Luck and maybe you find one just be careful and make sure you have reserves in place and the property cashflows.

@Anthony Fontana

I totally agree as my last 2 apartment community purchases have been from mom n pop owner (1 off market and the other from a broker). They are highly motivated and easy to negotiate with some seller financing if you come across the right one on the back end.  This is who I specifically target when looking for these apartment deals although they are hard to come by at times. So I don't do any direct mail, I simply pull list from list source and skip trace the owners directly and cold call them. With my experience directly mail has been costly and a waste of money finding  these off market deals, although many people have had great success, I no longer choose this method. Best of Luck!!!

Hey @Adebowale Asaya Personally without you owning any other properties I would agree with @Stephanie P. and leave under you personal name and get liability insurance to cover you (that's basically what an LLC is) and you won't have to worry about a possible due on sale clause and going through the process of a refi. You will also still get the tax benefits the same as an LLC just do a DBA. Hope this helps and Best of Luck!!!

Hey @Robert Sapienza to answer your question there are 3 ways appraisers value a deal (income, cost or comps). In regards to the MFR property you are looking at they should be valuing based on the income approach (need to talk to appraiser if possible prior to ensure this method is being used), which takes the NOI divided by the going CAP rate for that market (that's why it's crucial to know your market especially when dealing with commercial properties). So in your example there is a NOI of $22k and with you being in New Jersey I'm assumming there are compressed CAP rates so let's say its trading at a 6% CAP. This would give you a valuation of $367k and to be more conservative at a 7% CAP you would looking at $314k. This would definitely cover your cash out refi at a 75% LTV with some room to spare. Oh and I have also seen some appraiser use a GRM (Gross Rent Multiplier) so basically it's the annual gross rent multiple. So let's say using your NOI of $22k and you are operating at lets say a 65% margin giving you a gross rent of $31k, then we multiply that by a rate factor of lets say 8 (market specific), then the value would roughly be $251k. So again, there are different methods and that's why it's important to know your market and I would cold call some local appraisers that the banks use to see what methods are being implemented for valuations. And this math is no different for valuing million dollar commercials deals, just adding a few 0's at the end. I hope this helps and let me know if I can be of any additional assistance or you need help analyzing a deal for a cash out refi (I built a financial model so feel free to take a look at my website). Best of Luck!!!

Hey @Matt M. I wouldn't advise this course unless it's free because there is so much free information online in regards to apartments like watching Grant Cardone's youtube videos and Joe Fairless as a really good website on apartment syndications and general information. I would also listen to all the BP podcast when they bring on MFR investors because they provide some really good information especially if you are just getting started and has helped my build my apartment portfolio. Best of Luck!!!

Hey @Jason Eisler I invest personally down in the Macon, Ga area with apartment communities and I would say the 31204 area is pretty good (Northern side of Macon) and you can definitely achieve better ROI's in this location, but again it comes down to running the financials. The Southern side near downtown and Mercer University can be a good area as well, but I would be very careful not to invest in certain pockets (just like anywhere else) of this area. If you ever need help running numbers, I built a financial model (example on my website) that I help investors all the time look at deals so just PM if you come across anything. I also have a Property Management Company and a manager that looks a potential deals for me (bird dog) so we can go look at properties for you as well and advise accordingly. Best of Luck and let me know if I can help out!!!

Hey @Rafael Campos if you are trying to wholesale a commercial property then you can use the same contract as a SFR (check out the documents on BP or you can join some FB if you search and they have forms there as well). Of course as others have mentioned, the safest route would be through an attorney that you trust that has your best interest. Best of Luck!

@Tony Marcelle there are always large hedge funds (usually takes longer to find/transact if no prior relationship or no connections) that are looking for properties to deploy capital if you cannot find typical investors that are looking for turnkey deals. Hope that helps and Best of Luck!