All Forum Posts by: Dan Kennerson

Sounds like a pretty good deal. are your rents just equal to your mortgage, or is there additional cashflow? Also would like to hear about how you like your portfolio loan

Within a Checkbook IRA LLC, Could I loan the LLC money if I treated it as any other loan? Or is this against the prohibited transactions rules?

7% COC with no additional expenses is pretty rough IMO, unless you're making an equity play. Are you wanting to buy this because you think it will be worth 20% more in 2 years? Or are you buying this as a more standard rental?

All in, I would fully anticipate the cash flow on that property to be negative over time. That doesn't make it a bad deal by itself, but I wouldn't be jumping on it unless I thought it was going to appreciate rapidly and I had plenty in reserves to cover expenses. 

If you look near the bottom of that calculator, it shows the 50% rule calcs (an estimate of repairs, vacancy, etc) that shows -$505/mo. 

Quote from @Tony Severance:

Quote from @Dan Kennerson:

Quote from @Tony Severance:

You can use an FHA loan with only 3.5% down to buy a 2, 3, or 4-Plex if you occupy one of the units as your primary residence for at least 1 year.

 Very curious, do they actually check on the occupancy part? not that I would ever break the terms of a contract, just curious. 

Yes, they do.  And you do NOT want to be caught committing mortgage fraud by not living in the property.  Saving a few bucks is not worth the jail time.  

Wow, wouldn't have thought it was considered fraud. good to know, thanks. 

Quote from @Tony Severance:

You can use an FHA loan with only 3.5% down to buy a 2, 3, or 4-Plex if you occupy one of the units as your primary residence for at least 1 year.

 Very curious, do they actually check on the occupancy part? not that I would ever break the terms of a contract, just curious. 

Quote from @Steve Meyers:

We have no where near the enough supply at least here in San Diego for there to be a crash let alone a massive correction.  I submitted two offers for the same client last week and both places had 5+ offers on them.  The recent drop in rates has caused a lot of buyer activity recently and I think were going to be heading back to a 2021 at least here in San Diego if this continues with these rates in the mid 5s.  I can't speak on other markets but this is what I'm seeing here in San Diego.

 I think we will see corrections in certain markets where lots of units are about to come on the market. Phoenix comes to mind from what I've heard, but I haven't looked up data for that since I don't invest there. 

Everyone I talk to in Northern California, from the bay area to Redding will still tell you there's a shortage. maybe a correction in Phoenix will calm the SoCal market, but I doubt it will create a correction there. 

but I'm spitballing, what do I know. 

Interesting, thank you for the information. 
Does BP (or BP Pro) have a boiler plate LP agreement? Or do I need to talk to an attorney for that one too? lol. 

 30-40% is really the norm? 

Are the LPs investing a significant portion of the capital to earn this? 

Quote from @Owen Dashner:

I can tell you from 20 years of both corporate (IBM, ConAgra Foods, HP, Ricoh) and agency recruiting, that your real estate investing experience will not matter on your resume unless the skills and experience you have are directly relevant to the job requirements.

I can tell you as a small business owner I would consider it a unique experience and skill set that would create a lot of questions i would have for the candidate, and if the candidate was able to frame it well, it would look like a good thing to me. 

But I'm also biased towards real estate. 

Personally, I'm looking for anything value-add, and looking at small multifamily and fixer SFRs for BRRR deals.

Given the current uncertainty, anything I buy I will have to be sure I'm buying at the right price. For me, that's more about DSR than comps, but comps are important too for the refi step, especially in the SFRs. 

This is the perfect time to be able to buy right. As Buffet likes to say, when people are greedy, be fearful, when people are fearful, be greedy. None of that negates being smart.