All Forum Posts by: Kumar Tummalapalli

Thank you Andrew - I understand that various factors influence , I am in the initial stages , So I am looking for general direction . If I get something for under 5% - no hard constraints on OTHER features. OK with 15 yr or 30 yr , Ok with prepay penalties and so on . For ex : A typical HML loan will be around 10-12% , yes there various levers that will impact but I wont get it for 2.5% . Based on what you suggested I did post in the local forum , So one option that came up was DSCR loans. Do you have any insights ?

Thanks again

Thanks will look in to commercial lenders 

If I want to get a loan for an investment property using my LLC , are there any options apart from private/hard money lending ?

LLC with two members , Buying Investment property

- 20% down payment 

Is it possible to get a loan at interest rate less than 5% ?

Hi John - Do you have any company recommendation for 12+ windows - I know I wont get the same rate , but I was quoted 500 a window and I have 12 fricking windows in my porch  :-)

@Micki M. Thanks for sharing the experience . I will run away the other direction - if I hear the word "turn key flipping " . I think there are various red signals here . Let me first state that , when I spoke to the company , I did have various questions which were not answered to my satisfaction so I never even considered working with them . From your post I dont think they did a good job . 

Keeping that aside - as you are an investor with some experience earlier , I think the majority of blame resides with you . you obviously have tried to learn as much as possible from the scenario and were brave enough to share this here , so you did great 

some of my concerns :

1. it seems they get you the contractor , this obviously means they have a relationship with him and its very clear that they have every incentive to work together ... There is no motivation for anybody in this process to be on your side ?

Who is the true third party that can protect your interests ? If I were in this process , I would atleast have a third party inspector go there and get a report 

2. ARV - I am yet to receive an ARV which is accurate , either from a wholesaler or a turnkey company , Their motivation is obviously to inflate the ARV , again how do you cross check ? there are many ways you could have handled this , obviously your own analysis - which looks like still was 30k above the reasonable price , your ARV has to be conservative , it should not be the best case scenario . There is nothing to act as a buffer in the deal - 160 k purchase , 40 k renovation - 200k ARV , there is no way anyone can even break even in this . One single surprise during rehab , then you could have lost more .

3. I see the response from the HML who finances their deals , he says " What makes their system unique is that all of these sales ARE public record. It's totally transparent "

I dont want to judge based on one statement , but this is very misleading . The purchase price and sale price are the public record. Lets say one of the property the purchase price is 200k and the sale price is 300k . This doesnot convey anything regarding their performance . Basically , this doesnt answer if its a profitable deal for the buyer .What is the rehab budget ? Did the contractor maintain the quality ? Is the level of finish up to the mark ? what are the holding costs ? what is the average market time in that area ? How do their listings compare ?

Anybody who support the company - or who had positive experience , should answer the specific questions raised , generic statements like "there is risk in every business " "they are in business for 20 yrs " are pretty much a waste of time as these dont address the current concerns. 

4. further more , if possible , can you state here , what is the scope of work so may be members can chime in - whether the rehab budget is realistic .

Anyway , if any newbie is reading this , please understand the complications involved , how certain business models are there to essentially screw you , need for independent party verification s, how to be diligent when reading some of the supporters responses

Wish you all success

My observation is that - Pro area usually gets less responses / help when you ask for . I dont know why that is

Also on a different note , I think there are safeguards in place to prevent such behavior . I think we were supposed to get the finalised numbers three days before the close date and the lender would have repercussions. I dont remember what we call this . 

Perhaps its a good idea to understand this process and make sure , the lender is adhering to this. If a lender is not adhering to this common safeguards then that would be my first red signal . I wouldnt rule them out completely but I would try to understand why they are not respecting that rule .