All Forum Posts by: Dean Suzuki

Wow.  Thanks All.  I really appreciate the information and feedback.  I listened in on Brandon's webinar tonight and he recommended posting our deals on the Deal Analysis section of the forum.  Before the webinar, I did analysis on the deal and went into escrow.  However after listening to Brandon, I thought it wouldn't hurt to get everyone's input.  I'm glad that I did and am blown away at the great feedback.  Thanks BP.  I think I met a bunch of new people that I can bounce ideas off.

Thanks,

Dean 

HI,

I'm looking at a deal in Memphis, TN (SFR, 3bd, 2ba, 1335sqft) from a turnkey provider at $77900 and wanted to get the community's feedback.

It just got leased with a tenant at $995/month on a 2 year lease.

The turnkey provider made it rent-ready (new AC/Furnance, carpet, flooring, etc.) so no fix-up costs.

• Property taxes = $1490/year
• Insurance estimate = $700/year
• Property Management = 9%/month
• Estimate vacancy at 8% (1 month)
• Estimate maintenance at 10% (built in 1985)

income:  $995/month

monthly expenses:

• $80 = vacancy
• $124 = prop tax
• $58 = insurance
• $82 = prop mgmt.
• $100 = maintenance
• Total exp = $444/month

NOI = $551

With loan, 25% down, fixed 5% at 30 year

• $322 ; Mortgage payments

$229 = net cashflow

It looks like its in a "B" class area.  Property appraised at 89K.

Any feedback appreciated.

Thanks,
Dean

Hi Folks,

Thanks for all the responses. I have learned a lot in them. It sounds like savings accounts and tiered CD strategy might be the way to go. I'll start to look into them. I'm wondering what people are computing for safety/emergency funds but I'll post another question on that. I have heard and read 3-6 months expenses per property. So, I have been computing on 5 months expenses per property which is adding up to quite a bit. When I look at that amount sitting in a savings account, I was hoping to get a higher return but still be liquid.

Thanks for all the responses,

Dean

Hi,

I have been reading the posts and have set aside money for an emergency funds for our rental properties. The funds are currently sitting in a bank savings account earning close to 0.01% interest. I am wondering if there are better places to earn a higher yield but still have the funds semi-liquid in case a repair comes up. Any suggestions?

Thanks,

Dean

Thanks all for the input. I was leaning toward allowing the cat with the addition of additional security deposit, additional monthly pet allowance, requirements for spay/neuter and up to date shots. But, with the latest round of feedback, I'm scared now. The house is 2000 sqft and would cost a bit to re-carpet.

So, I'm not sure what to do.

Wow. Thanks for all the replies. I have never had a cat before so having everyone's input is awesome.

Thanks everyone,

Dean

Hi,

I have a tenant that has leasing my property for over a year and has been good at making their payments on time (in other words a pretty good tenant). They asked if they could get a cat. We currently have a no pets stipulaton in the lease. They are renting a 2000sqft SFR.

I have read some of the posts with the issues with cat urine and trying to clean up after the tenant leaves.

I'm debating what to do. I'm thinking that I could say:

1) No. Have an upset tenant.

2) Yes and ask for a pet deposit. How much is the typical amount? I doubt it would cover re-carpeting the house though.

3) Yes and ask for a pet deposit and monthly pet rent adjustment. Is this allowable?

4) Any other options?

Any suggestions are appreciated.

Thanks,

Dean

Thanks everyone for the feedback. This is my first time looking at loans that are not 30 year fixed. So, these new terms and rates are all new to me.

Does this loan mean that in 5 years that the rate will adjust based upon the 5 year ARM FHLB. Then, balanced upon on the outstanding balance, does the bank recomputed a 15 year amortization at the new rate? Then at 10 years, the rate re-adjusts and the bank recomputes the a 10 year amortization at the new rate? Is that how this loan works?

Thanks,

Dean

Hi,

I maxed out on my Fannie loans so I have been searching for portfolio lenders. I found one that lends at the following terms:

• Interest Rate: 5-year FHLB + 3.00%, floor or 5.95%
• Adjusts every 5 years
• No cap on rate adjustment (Note: Seems scary)
• Maturity: 20 years
• Require 30% down.
• No prepayment penalty

I am wondering if anyone knows what has been the historical 5-year FHLB rate and any predictions on what it might be in 5, 10, and 15 years since the rate adjusts every 5 years.

The no cap on rate adjustments is the scary part, but I guess I could prepay the loan if the rate goes crazy high.

Does this look like a good options to secure long term financing if I've hit my 10 Fannie Mae loans already?

If not, please let me know any better options.

Thanks,

Dean

Welcome Aboard Luis. I actually have a rental in Marietta GA on Cumberland Club Dr. Let's keep in touch.

Dean