All Forum Posts by: Dan Hertler

@Rick Pozos of course and that’s certainly not what I was intimating. I was purely asking about the logistics for recording these loans, and how this all works since I have not seen much info in my research regarding the recording of private loans. As I mentioned, I am admittedly a beginner in the private lending space.

Thanks for the info, I appreciate your guidance

@Rick Pozos I see what you're saying- so you'd only pay interest to the lender based on the drawn portion of the loan, similar to a HELOC. That's very good.

When you had a private lending agreement, did you file the deed of trust with the state/county? Or were they unsecured loans?

Also, from an underwriting perspective- am I required to disclose this debt to mortgage underwriters (conventional) so long as the debt is still outstanding? So far all of the research I've done on these private loans has been silent from that aspect. I can envision a scenario where I want to purchase another house in the short-term with a conventional mortgage while this BRRRR/private debt is still in progress.

@Kenneth Garrett thank you so much for the info!

@Kenneth Garrett

Thanks for the reply and really good info!

I plan to refinance into a conventional mortgage after seasoning, upon which I will repay the loan along with interest.

As for being a second position behind the primary mortgage, isn’t this a similar situation to construction loans? e.g. if I took out a construction loan to put an addition on my primary home, wouldn’t this be a second position loan?

Hi all, I have a SFR under contract that will be closing in the next week, and I will be doing a BRRRR once tenant moves out (next few months). I am funding the down payment myself, but I would like to obtain private money for the rehab.

My question is surrounding the exact logistics of making this possible if I do not currently have an LLC.

Qualifying question: do I explicitly need an LLC to do this type of transaction without setting off IRS red flags?

If no...

Once the promissory note and other loan documentation is in place, how exactly do I take this cash in? Does the lender wire to my checking account, then I pay the GC or tradesmen directly? And once I complete cash-our refi, I would wire loan proceeds + agreed upon interest back to the lender?

From an IRS perspective, can I receive/pay out loan proceeds from a non-business checking account? e.g. I ONLY use this checking account for real estate purposes, but it’s not considered by the bank to be a “Business” checking account.

Reading Matt Faircloth’s Raising Private Capital and while being a great book, still need some more info regarding the operational aspect of the transaction

Thanks & Happy new year!!

Dan

@David Smith I use Frank Moore & Co. and they have been great, but I've only used them for SFR management so far- can't really speak to short term rentals, but it's worth giving them a call

@Nicholas J. Cammaroto

Welcome aboard. I am a long distance investor in the Savannah area as well, it’s a great place to invest. We should connect.

@Steve Collins what is your company’s investing strategy? I’ll send you a DM, interested to learn more about it

@Edwin Parrilla

Just catching up on this- did you get those two quotes like you mentioned? Who did you end up going with, and how was your experience?

@Joshua Austin

Great work, Josh!!

@Tyler Caglia

Congrats on your success thus far, it looks like you have a bright future in REI ahead of you.

I have a very similar story- been listening to the podcasts religiously for the past 6mo, but live in an area where buy and hold numbers don't make sense. I closed on my first buy and hold in January in Savannah Ga, and now have a second one under contract, which I am planning on BRRRR'ing. My 2019 is 3 properties, but depending on how this one goes I could surpass my goal.

I’ll send you a PM- always looking to connect with like-minded OOS investors! Cheers