All Forum Posts by: Alex Cabej

I try to be buy and hold...not 1031 type really.  But what do you mean by "next 5 years"?

Northern NJ.  Bergen county.  

Hi all.  Hope everyone is staying safe these days🍻.

One of my tenants moved out.  Currently the building is a under a fixed 30 year investment property (residential) mortgage.  Because it is an investment property the rate is a bit higher (25 basis pts).  

If I were to take the unit, would I be able reclassify the mortgage ?  I'm not really interested in a refi, tbh.

All feedback is welcomed.

We've probably heard of the 1% and 2% rules.  What general eyes tests do others use.

I live in northern NJ.  I have 2 initial tests.

1. I ideally value a property at 8 x annual rent.  I don't factor in rent increases or inflation really.  My Max is 12 x annual rent (if location is outstanding).

Reason: decreases chances that the property becomes a money pit.  And I can continue buying without being forced to sell. So it's really a play off the 10x cliche, I just discount 20% for the mortgage (sometimes higher than I want) and T&I increases.

2. I Wikipedia the median income of the incorporated town/borough/area.  If it is <6 digits, I (sometimes begrudgingly) move on.

Reason: it's a good basic barometer of area stability.

Again, these are just my 2 main eyeball tests that I perform.  What about you?

I'm based in northern New Jersey, which is experiencing quite the new development explosion. In other words, I want to grow my portfolio in the area.

I'd like to start the ball rolling on this.  In my case, the properties I am interested in refi-ing are titled under my name.  It appears most banks/lenders (excluding hard money lenders) don't work with EINs.  

What steps should I take to successfully refi specific properties in NJ?

Lastly, I think this could be a very good instructional thread and EVEN BETTER PODCAST for investors who are looking to grow their portfolios. (This sort of information isn't readily available and most traditional bankers are equipped for this conversation, unfortunately.)

Hi all-

I have a 800+ credit score, which I am very proud of. I own properties with a higher rate than I like.  They are in high-end areas and generate juicy income! So the trade-off is worthwhile.  

I am on the lookout for new properties to add to my portfolio. I am always considering refinancing to more reasonable rates, such as 4.3-4.5 (my rate is quite a few basis points more). Would refinancing really hurt my chances to add to my portfolio? My credit score would take a hit, presumably, unless I refinance under my LLC correct?

I would like to move the titles over into my corporate name, but haven't figured out how to achieve this. I notice whenever I look at buildings (mixed or residential) to buy, they all have titles under corporate entities, usually just llcs.  

Most of the tax, insurance, and bank "experts" I have interacted with are not very advanced and get confused easily, unfortunately.  Can anyone please point me in the right direction?

Thank in advance,

AC

@John Patton

I can't remember last time I watched day time tv.  I remember that's when all the lawyer commercials come up.  TBH I've never had real issues, and even if I did (unless of total loss) I would NEVER file a claim. My premium would skyrocket even more.  The previous owner filed an insignificant claim in 2006, and it was on the property history when I took it over.  Ridiculous from my perspective.

My properties are in NJ, but my mortgagee is in MI.

I'm under the impression, a mortgagee can legally only demand the mortgage amount is reflected in the coverage.  Not the purchase price/market value.

PLEASE correct me if I am wrong.  Thank you in advance.

I noticed my hoi coverage is for more than my mortgage on the house.  Before I contact my insurance to lower my coverage and pay a smaller premium, I don't want to sound foolish.  So I want to check first, can my mortgage company mandate that I have coverage for more than the actual amount of the mortgage itself?

I intend to use the savings of smaller coverage to gift to the super.

If you are a buyer, which type of seller is more motivated to sell to you at YOUR price (e.g. IS MORE LIKELY TO BE A PRICE TAKER):

1.-Seller looking to recoup renovation expenses (presumably no time constraints and knows their expenses are in the past)

2.-Seller motivated by 1031 tax deference (specific timeframe constraint) and wants to buy something closer to home.

3.-Another seller motivated by 1031 tax deference (specific timeframe constraint) and wants to buy a bigger property (theoretically threading the needle more than#2).

If you are a buyer, which type of seller is more motivated to sell to you at YOUR price (e.g. IS MORE LIKELY TO BE A PRICE TAKER):

1.-Seller looking to recoup renovation expenses (presumably no time constraints and knows their expenses are in the past)

2.-Seller motivated by 1031 tax deference (specific timeframe constraint) and wants to buy something closer to home.

3.-Another seller motivated by 1031 tax deference (specific timeframe constraint) and wants to buy a bigger property (theoretically threading the needle more than#2).