All Forum Posts by: Dominic Mazzarella

Property managers absolutely hire assistants to manage overflow. I like to have 1-2 virtual assistants to handle tasks that I don't want to spend time on. Almost everything can be done virtually these days including many property management functions.

3 Votes

Columbus, Ohio

Quote from @Adolfo Herrera:

I recently bought a piece of land(cash) in my hometown in Texas and I am looking to start building a home to sell.

The lot sits in a new neighborhood and is in the more affordable side of the Rio Grande Valley. Homes currently up for sale in the area are about $250,000 for a 3beds/2bath and roughly 1300 SQFT. Lots of small builders with their standard spec home.

My plan is to build along the same type of home, but of course with some of my design inputs.

I want to get a really solid foundation before any actual building happens and I would truly appreciate any advice that anyone has to offer of some preliminary items I should know and take care of beforehand. Basically anything that I should have before the construction starts.

Currently in the step of figuring out how to get home plans and how to work with architects so I have the following questions:

1. Should I work with a local Architect to design from scratch? Or should I grab plans from a local builder and work with their architect to modify the plans to more of my style? Reason I ask is because after buying the lot, the seller was also a builder and mentioned he could sell me his plans and connect me with his Architect.

3. How much should an architect cost me for a 1300sqft design? In terms, of Great Price, Fair Price, Overpaid.

2. Do you have any experience using a piece of land as collateral for a construction loan? And is it a route that you would recommend?

If the seller was also a builder and has plans, that could be a great shortcut, especially if they’re already approved or meet local codes. Buying existing plans and tweaking them through an architect could save time and money compared to a fully custom design. For a 1300 sqft home, architectural costs vary, but for a fair price, you’re probably looking at $3K-$8K, depending on complexity. If you go fully custom, it will be higher.

As for using land as collateral for a construction loan, it’s definitely possible, but lenders usually want to see a decent percentage of equity in the land. If you own it outright, you’re in a strong position. Have you talked to any lenders yet to see what terms they’d offer?

1 Vote

Rio Grande Valley, Texas

Quote from @Chris Anthony:

To clarify we are sellers not mortgage broker. We have a potential buyer of a lot in St Augustine, FL who would like to build a new single family short term rental. Property will be held in LLC. Looking for best options. Good credit. Good cash flow and equity upon completion. Do 80/90% of land 100% of construction loans exist? Or what programs can anyone suggest that would be best for this scenario. Thank you in advance for reading!

Yes, there are lenders that will do 80-90% of land and 100% of construction, but it's usually through specialized construction loan programs or private lenders. Banks and credit unions might have lower-cost options, but they'll likely require more equity. You might also want to look into DSCR loans since it’s an STR. Have you considered reaching out to local lenders or brokers who specialize in new construction? They might have access to portfolio loan programs that fit your buyer’s situation.

1 Vote

Quote from @Robert B Azimi:

A restaurant that’s doing great business feels he shouldn’t pay the rent on time for the last 4 months every month we had to post 3 day notice to pay rent or quit on his front door for him to deign to pay his rent

What legal action we could take to make him understand he is not the landlord we are he must pay his rent on time?

If you've had to serve a 3-day notice consistently, it's probably time to escalate things. You could look into enforcing late fees if your lease allows it or even start the eviction process to show you're serious. Some landlords offer a discount for early payment as an incentive, but I'm not sure that would be appropriate in this case.

1 Vote

San Diego, California

Quote from @Christina Venegas:

Quote from @Dominic Mazzarella:

Quote from @Christina Venegas:

is it possible to do HELOC on a primary home that was purchased 6 months ago with 5% of down payment, the property was $145k and it was appraised at that time for $160k. i need advice from investors and lenders, if anybody knows some lenders that could help me I would really appreciate it, thanks for taking your time to respond

It's definitely possible to get a HELOC on a primary home, but most lenders have a seasoning periods which are typically 6-12 months after purchase before they'll allow it. Since you put 5% down and the appraisal came in at $160K, your available equity might be limited since banks usually cap HELOCs at around 80-90% loan-to-value (LTV). You'll want to check with local credit unions or smaller banks since they often have more flexible HELOC options. Have you already asked your current lender? Some will offer a HELOC even if they originated your first mortgage.

thank you for taking the time to respond, I will look with some credit unions

That's a good call. If I were you I'd send a quick message to your current lender as well.

0 Votes

Chicago, Illinois

Quote from @Bernice Dezelan:

Hello, How do you comp a property that is 12,000 sq ft and mixed use 3 vacant store fronts and apartments above? Thanks, Bernice

One approach is to break it down by looking at similar vacant retail spaces nearby and comparing price per square foot while factoring in potential rental income once occupied. For the residential side, check nearby apartment rents and recent sales of similar mixed-use buildings to get a sense of value. Another option is to estimate value based on potential income and market cap rates, which can give you an investor’s perspective. If comps are scarce, you might also consider the replacement cost approach, looking at what it would take to rebuild and adjusting based on market conditions. Since the property has vacancies, a buyer might discount for lease-up risk, so that’s something to factor in.

I owned a multi-use property in IL that is definitely different than what you're looking at. It had a mobile home park component, self storage, commercial and industrial tenants but it was interesting figuring out how all the numbers worked together. These deals can definitely be tricky though.

0 Votes

Newark, New Jersey

Quote from @Drew Slew:

Quick question on those who have done seller financing:

- Buying a 0.3 acre downtown fort lauderdale multi family, negotiated an around 1M price w lot of development rights, double lot. seller got it way back early 90s for pennies

- got good credit 800+, w2 job etc put 40% down and mortgage bank offered 6.62% 30yr fixed (CF negative as this would make current rent roll not too much compared to the PITI)

- property is in ok condition, needs 20-30k repairs which seller OKd, and all 3 tenants are month to month, pay bit under market but also ok

- seller would like to do seller financing, interest only at 5.75%, 30yr amortization at 7yr balloon (CF would be positive) - id be paying some principal as well, just to grow some equity

- buying this deal for the future development of the area (las olas, kushner broward crossing) so not really worried even if we overpay for it now, but never done creative finance as i always relied on a strong W2 job to get good loans but obv im used to 3% 30yr rates from covid times not this 6+ environment..

Goal is to hold the property 3-5yrs, and then actually develop it or sell half the land / refinance, pull out HELOC if it appreciates.

Questions:

1) What does he know that i dont? Trying to make sure seller isnt pushing this seller financing without us knowing something they do. Overall we both would win it seems quite big, esp w interest only the cashflow would be positive. he didnt really like we are doing an appraisal as he might be thinking he can pull a fast one on us w his price tag.. again happy to overpay as i see the potential but obv not outrageously.

2) Can principal be payed down in interest only seller financing? even if its interest only, id want to pay down principal here and there. seems like sellers would offer this interest only route so they have 0 capital gains tax, but id rather pay down a bit of principal in 7yrs. i see its not required but it should allow for principal paydown in promissary note

3) any general advice to look out for on seller financing?

Thanks any input

If the seller is pushing financing, they likely want steady income without a big tax hit. If the price and terms work, it’s probably just about structuring the deal in their favor. That being said, if a seller is pushy about financing it does raise a yellow flag for me, perhaps they want to finance because they don't want a bank or anyone else looking under the hood. I'm extra cautious when analyzing a deal like this, but a lot of them end up being great.

For interest-only financing, negotiating some principal paydown is a good idea. Even if it’s not standard, a well-structured promissory note could include it. Sellers who don’t need a lump sum upfront may be open to it.

Biggest thing to watch is the balloon payment. Make sure your exit plan aligns with it, whether that’s refinancing or selling. Also, check for prepayment penalties or clauses that could cause issues.

2 Votes

Miami, Florida

Quote from @Christina Venegas:

1 Vote

Chicago, Illinois

Quote from @Blair Ross Jr:

What platforms or programs do you use to assist you in selecting a tenant?

A lot of landlords use platforms like Zillow Rental Manager, Apartments.com, or Avail to list vacancies and screen tenants. For background and credit checks, services like RentPrep or SmartMove can be helpful. Do you already have some kind of pre-screening questionnaire setup to weed out undesirable tenants?

0 Votes

Grand Rapids, Michigan

Quote from @Anastasia P.:

@Dominic Mazzarella Thank you for the help! That's actually an excellent idea .... do you know where I can get more info on how to rent out the land for passive income? That sounds like something I'd be interested in looking at as well.

@Anastasia P.

Not off the top of my head, sorry. If I come across anything relevant I’ll get back to you though.

0 Votes

All Forum Posts by: Dominic Mazzarella

Dominic Mazzarella has started 7 posts and replied 221 times.

Post: Hiring an assistant for PM

Post: Seeking Advice as a First Time Builder

Post: New Construction Loan For Short Term Rental

Post: Tenant keeps not paying on time

Post: HELOC on a primary home

Post: Comping Multi-use Real Estate

Post: Seller financing fort lauderdale interest only

Post: HELOC on a primary home

Post: Process of Filling Vacancies

Post: Wanting to learn about mobile home investing -- currently own 5 parcels of land