All Forum Posts by: Mike Franco

I need a strategy.

I'm retired, but never got into the BRRRR. I have $1M cash and $1.5M in paid off real estate assets, no debt, and no 'real' income. 830 FICO.

I want to leverage my assets and start BRRRR to secure retirement for the kids, getting the ball rolling so they can have paid off properties by the time they retire.

$1m cash isn't really enough to buy many cheap properties in Socal. So I want to use the bank's money as much as possible.

How do I get the ball rolling fast?

I don't understand how the numbers work for subsequent BRRRR properties without much income. Hear me out...

I buy a $300k house cash. $50k rehab. $500k ARV. Rent in Socal is ~5% cap rate, so $2100/month gross rent.

I'm down $350k already, and I need to replenish the $350k. 

Will the bank really lend me $350k cash out refi 70% LTV with only $25k gross rent as the only source of income? How do you even fund subsequent BRRRR properties with bank money in my situation?

I have enough assets and want to use the bank's money at the lowest interest rate possible to grow a BRRRR portfolio as quickly as possible.

What realistic timeline am I looking at here?

I'm hoping to acquire 10 BRRRR houses that are $500k ARV, which I expect will all be worth $750k after 30 years, for a total holding of $7.5M at the end of 30 years, which the kids can sell and retire off of.

Frank Chin, but no joke, in my area of Los Angeles suburbs, tons of people would be fighting to pay $850,000. It's not overinflated value. 

$850k is way below market value, and if a lender seized this property and sold it at a huge discount, they would get their $300k back + interest.

Those lenders that went bankrupt rolling bigger loans... well, they deserved it.

My case is truly that simple. If you look at the market sales history, there is just no way my property is even worth less than $600k today, so a $300k loan is a super safe bet for a lender with a lien on my house.

they wouldn't be able to just foreclose on the $1m house to get their $300k back?

My house will easily sell for at least $1m.

Just the land value is worth $850k, if the house burned to the ground.

It doesn't make any sense that retired folks can't unlock cash. 

My rental income does not cover enough to get a $300-350k loan. We're talking <$30k yearly gross rents and no other income.

I have plenty of collateral... house, savings, stocks.

In 2015, I stopped paying american home shield $450/year. They never cover anything, always send out the worst contractors, and always have dumb excuses to deny coverage for repairs. Back then there was also a $70 visit fee.

In 5 years, I saved $2250.

2 years ago, the 25 year old water heater burst, and I paid $1200 out of pocket for a new one, calling my own plumber. Llast year I paid $350 to have a tub drain replaced and snaked.

As you see, I'm still ahead. For me, it was pretty pointless flushing money down the toilet for AHS

I have a $1m house paid off. 830 FICO.

If I cash out refi, I can easily get a loan for $300k to buy a fixer.

After spending $50k out of pocket to repair, ARV is $500k. I want to further leverage the increased equity from this $500k house.

Let's say I am retired and have no income, but now I can rent out this 500k house for $2100/month.

What is the next loan I'm supposed to get? 

With only $25000/year projected gross rent and no other income, can I easily get another 70% LTV cash out refi for the $500k house = $350k low interest loan, repay the original $300k loan and pay myself back for the 50k renovation cost.

... and then repeat the exact same steps to buy another $300k fixer? and keep snowballing just from the $1m house I have?

Basically I'm wondering if I can get the lowest interest rates with no income... and how lenders calculate how much they're willing to lend me.

I've just started to learn about wholesaling. So my first stupid question is..

Let's say you find a good deal and you market it to your buyers/investors mailing list.

A few investors look at the property , pass on it, and you're unable to complete the wholesale transaction.

Now that the investor knows where the property is, what's to prevent that investor from going behind your back and dealing with the owner directly and cutting out the wholesaler?

I mean now, all I need to do is approach the seller with whatever price the wholesaler negotiated and not have to pay a markup.

I found a coating product I've never heard of before.

It's called Betco Hard as Nails, which claims it can be rolled onto vinyl to marginally increase wear resistance.

I wonder if anyone ever recoats their vinyl planks the same way they do with hardwood floors.

well, who stands to benefit from inflated appraisals?

because this street and location has never had anything sell for close to $740k. The comps don't support it.

And since I've never heard of 100% value loans, this $740k represents an 80%+ value, let's say, which means the appraised value is a ridiculous  $822k-925k

Look at this crapshack with so many high voltage lines near it.

According to the data and tax info, the home value estimate is about right, but look at the loan info.

I'm guessing that's a reverse mtg. But how are they getting loans way above their home value?

Are lending brokers trying to pad their own fees and commissions?

i went to Floor and Decor store and scratched their expensive vinyl plank with a sharp object, and they all scratched.

The only thing that didn't scratch was ceramic/porcelain tile.