All Forum Posts by: DeAndre Mason
DeAndre Mason has started 15 posts and replied 33 times.
Post: DSCR Lending strategies
- Posts 34
- Votes 7
Im curious as to how to go about obtaining PML for a DSCR loan option. How would you structure a deal so that the private money could cover the down payment and fund the rehab in order to minimize money out of your pocket and being able to pay the private lender off when you refinance? Or, is it possible to use a PML for just a downpayment for a turn key DSCR multifamily property not in need of any upgrades? How would you structure a deal so that someone would be willing to just give you down payment money?
Post: Electric baseboard heaters in Cincinnati instead of furnace?
- Posts 34
- Votes 7
Quote from @Alecia Loveless:
@Brandon T. I’m in NH and am getting out of the business of paying for my tenants heat. I have one building I’ve owned 3 years where the tenants regularly keep the heat on 78 and wear t-shirts and shorts and go barefoot when it’s -25 out and I bought another one this past spring that when I was doing due diligence in the winter at least 3/8 units had the heat on 78 and the windows cracked and it was -15.
I am putting in propane Rinaii heaters. There will be one for each living room and bed room and I suppose if you had dining room/other rooms they would need one too. Each tenant will have their own propane account with my fuel company and a commercial rate which is about $1.00 cheaper per gallon than rack rate. It’s much cheaper and more efficient than electric.
It’s expensive but I will recoup my cost on each building’s oil cost in 2 years not to mention the write offs which I haven’t factored in.
For 18 units for my largest building it’s going to be $40K for running gas lines, 18 heaters, placing the heaters, placing the tank, digging the trench for the line to the tank from the building and reburying it, and having the propane company out to test all the units. I’ve already used $1500 in oil in 3 weeks for heat and it hasn’t been below 45 yet. So I know the building just eats fuel.
Post: Bathroom Finishes For Remodel
- Posts 34
- Votes 7
Hello BP,
Currently remodeling a unit in a duplex. I was going to put an LED mirror in the bathroom to add a "pop" in order to make my rental stand out in my market where everyone mostly provides frameless standard mirrors. I am debating on also installing an extra vanity light above the LED mirror. Would this look okay alongside the mirror? I just think the mirror alone will not provide enough light in the bathroom (60-80 sq ft.) but I am also installing one recessed light above the shower tub. Let me know what you guys think about this idea.
Post: Paint on old vintage kitchen cabinets
- Posts 34
- Votes 7
Hello BP I wanted to get your guys thoughts and opinions on what color I should paint my kitchen cabinets. I am remodeling but keeping the existing cabinets the doors were customize so they’re all different sizes so I can’t just replace each door unless I wanted them custom-made, so I’m just going to have to keep the regular flat face cabinet door and paint over. what color do you think would be best with a dark brown luxury vinyl plank flooring and beige walls?? My first thought was black, but I heard that doesn’t hold up well with the rental, because it gets dirty very easily.
attached is a picture of the kitchen.
Post: Beginner Landlord Requirements
- Posts 34
- Votes 7
Quote from @Amanda Gill:
Here in Parkersburg we just needed to have the city inspector inspect the building to make sure it’s up to code and the fire marshal inspect. Then they will give you your certificate of occupancy. Pay your b&o taxes on your rentals.
There's not many REI groups in WV, but I've seen one for Charleston, I've seen them post before.
Could you let me know what kind of rates you’re getting for your property management? I’d like to know. I’ve heard 30% from someone who does taxes for someone that uses one. Thought that was very high.
Good luck and congrats!
10% mgmt fee. 30% is highway robbery. What is the REI group in Charleston called. Where can i find it? Thanks!
Hey BP, let me first start out by saying YES wholesaling is possible on the MLS and legal as long as there is verbiage in the PA stating the buyer may assign the contract.
Now, if I had a property under contract with an agent and wanted to assign that contract to another end-buyer with a different agent representing them, how would that work getting that to the closing table? The end buyer has an agent already and that agent wants to know more info about the property and getting their client a tour? Is this too much headache to deal with? Is it possible to close with an assignment of contract? I have a buyers agent for me but then the "assignee" would have another agent representing them... Is there a way around this where one of the agents can get a referral fee without the title company having to figure out whos getting paid? Traditionally the end buyer would not have an agent. Sorry if this is confusing.
DeAndre
Quote from @Chad McMahan:
Quote from @Dan Grove:
I have about $360K liquid available. I have no real estate investments. If you were in my position, what would you do? Invest in a single family, more than 1 single family, multifamily, etc? Looking for some differing opinions. Thanks!
Be very very picky with where you park your money, and don't base your investment on who you like- that's a con artist's paradise. Base it choosing a seasoned team of professionals who are the best at real estate investment returns.
I would recommend you either put the cash into:
1) 1-3 high performance real estate funds (You should be able to at least double your money within 5 years)
or
2) Buy 1-2 STR's that should get you at least 20% profit returns per year on that $360k = $72k per year. Before any naysayers say this doesn't happen in the current market- my clients and I are doing this at more like 20%-35% cash on cash returns in the current market.
It can feel scary to temporarily say goodbye to a chunk of money like this. Start by teaming up with a really good seasoned investment specialized real estate agent in the market you will likely invest, and have them team you up with a phenomenal lender and property manager. Chat with everyone at least 1-2 times, take great notes and ask tons of questions.
Also- put them on the spot. I applaud my new clients when they have the courage to challenge my knowledge and experience, before deciding I know my stuff. Nobody should take offense to that.
Dan, good luck- here is to an amazing 2023. It's going to be a good one.
if you wanna be safe, throw it in a CD or treasury for now until the interest rates get better.
Post: Beginner Landlord Requirements
- Posts 34
- Votes 7
Hello BP,
I am potentially closing on a 4-unit multifamily property that I will owner-occupy. The property is located in West Virginia and I was wondering what I need to have in place to legally rent out the other 3 units. I am going to hire a property manager in order to learn how to set up systems much more quickly. Are there any licenses or certifications I need? What safety requirements do I need to provide to the city or state in order for me to have all my "i's dotted and t's crossed".
Quote from @Joseph Beilke:
What state is this deal happening in? The laws in whichever state this deal is going down in will directly effect how the terms are negotiated. The real estate agent helping you can act or represent you in a few different levels. But the state in which she is licensed will definitely her default roll or the ability to change it. So us here in the BP need more information about this deal to be more helpful.
As for terms, you alway need to have ways to get out and get your EMD/Escrow back in the event you need to back out of the deal. You never want to Locked into the purchase. You want a legal way out even if you do end up giving up some if not all of your EMS
EMD amount, inspection time frames, financing contingency, closing dates, point by down, current leases if any, current liens if any, repair or replace benchmarks, occupancies agreements, material items, closing agent, shared or unshared closing cost. You can negotiate anything into a contract. You could offer to sent the seller a meat lovers pizza to there new address every 3rd Wednesday of the month for 18 months.
Everything is negotiable, the bottom line is this, get the deal done as long as at the end of the day the deal cash flows and ROI makes you happy
West Virginia is the state the deal is being closed in. Thanks for the info. The contract does not have a 'no assignment clause' however I will be disclosing to the seller that this may happen and have the realtor add it into the contract that I may assign to partners or other investors.
BP,
I have an off market deal in the pipeline but the seller has had an agent contact me saying she will submit an offer with a purchase and sale agreement. Giving this contract is assignable, What else should I deem necessary to be put into the contract besides an inspection contingency and marketing clause. I plan on wholesaling this deal. I will be opening escrow with this purchase agreement with a title Attorney and the realtor will not be getting a commission.
Should I use the realtor’a contract? If so, what else should I negotiate in the contract.