All Forum Posts by: George G.

I have studied most of the available loan products out there.  IMO it really depends on your strategy and your investment style what your overall plan?  I work for a lender my honest opinion is don't borrow money at all.  Let me explain.  Lets use a simple $300K flip for numbers.  On average it cost you 2 points plus closing costs to acquire this property.

1.Cost to get loan funded most lenders 2 points and up= $6k

2.Closing costs = we will round it up to $4k 

3. Carrying costs = 6 months is average flipper hold time 10% intrest average soft money loan cost = $2400 a month = $14,400 (minus downpayment of 60K) = $2400

Total costs to acquire and hold minus all other non financial costs = $24,400

You guessed it! On average a $300K home costs you $25,000 to hold in financial costs!!!!!!!!!!

This means you need to profit an additional $25,000 per project to come out ahead, want to make $25K in profit from the start of your project don't borrow money.

So this is one of the many mistake undereducated and ill advised real estate investors fail to take in to account the real amount of money it costs to carry most projects.  

Like I stated its better to not even borrow money if you can avoid it at all costs, and it does cost about $25,000 to borrow!!

I have a couple of options for you if you were interested Im a Visio and Corevest approved broker for both products You can  can check out or site www.blacksquarelending.com  if you want or just DM, and I can advise what would work best for each situation. 
I preface this as only just informational not a pitch. I can provide the loan products and terms with each feature. Then you decide.  
 
I’m one of the few national brokers that has multiple investor products and I can do commercial loans nationally   

Yes the Long Term Rental loan is a ballon product 5-7-10 years and it amortized over 30 years range of 5-6% under your business name or LLC. They will finance unto 75% of the LTV of the property based upon an appraisal by their 3rd party appraisal service.

This is where people get into trouble and are dis illusional. Everyone thinks they are sitting on a pot of gold like a leprechaun and over estimate the Value of the property. Be realistic on the LTV and you will be happy, be unrealistic trying to cash out all your equity which is a rookie move but feel free to do it, I don't recommend it.

Yes, I have a institutional revolving credit line $3-25M (reusable per project based on a simple $2500 fee to use each time and no underwriting) they do not offer revolving line only regular line from $1-3M. I highly recommend it if your a serious investor (difference between hobby and business). Must have 20% of the LOC in assets, 5% liquid, taxes required 2 years and a 650 credit, If you need details just contact me thanks.

This loan is designed for the active investor who actually has at least $600K in assets ( could be property, 401K or cash, retirements but must have 5% liquid.)  If you making headway in the Real Estate game and want to have an available credit line this is the way to go.  This is not a blanket credit line it is property based you can leave it unused for 18 months if you don't use it it expires. 

I really like this product because you don't have to go through underwriting every 3-6 months of flips or projects.  For those reasons alone if you going to get money form a lender this is the way to go.  I can do 3-5 flips a year depending on fast I move.

Hope it helps.

Im doing the essential program as well its funny everyone is scarred to answer this question lol. Is it worth it? Well yes and no, the 10-12 hours of Webinars are similar to here but the real gem was the software Renatus IOS. The software alone is worth the 2K all day long. Sorry, BP fans the software is the cat's pajamas. Ive been doing RE for (10 years up to 35 doors) and that software is like watching real estate porn. Is 20K worth it? Probably Not. Thats debatable right but 2k I can do. Now compared that to all the Gurus programs (Chicago Real Estate Investing Association) Chicago REIA $50K program that a straight up SCAM/Thieves you tell me? I have gone to most of the free GURU classes to see what they have to offer and I found they are total scum sucking scam artists with absolutely no morals. With this group you find people who want to partner with you because a lot of newbies are worried when doing RE deals alone. Everyone on BP wants to be mogul but they are cheap and don't want to pay 2k or more for education, finding RE partners and the tools, programs they provide (imagine overpaying for property and making mistakes that cost you thousands to tens of thousands (trust me I have made them). Heres a free one, go to Credit Nerds they a full Free 100% credit repair program, even if you bring your score up just 10-20 points why not it totally free is there a catch? No if you want to sign up for credit monitoring that where they make the money but its still 100% free. This is just the plain simple truth if you're brand new and know nothing yes and even for guys like me I have some experience but can still learn a lot, you have note investing, wholesaling and more, I believe its worth it for the 2K program, also you get exposed to like minded people in your area, and the software for $125 a month. I would start there. If anyone wants more info PM. There is no mystery here or secret the program is pretty clear do they have tons of affiliates and programs they want to sign you up for and make money? Yes but they actually tell it to your face. It's pretty simple just say NO, use it for what is useful don't get caught up in the hype and keep on investing. Did I ever tell you what my $100K private college education plus expenses got me? I crappy office job making 22K in 1995, I think the colleges got everyone scammed. Just my 2 cents.

@Thai Tran this is where your due diligence May have failed you. Did you have the property inspected? Is it in a flood zone ? If it’s a one time thing then you should be able to file and insurance claim. So I am assuming it’s a flood zone or existing problem. If it was me I would fix it and run. Properties with leaky basements and flooding snd other structural issues eventually end up cost you more money than profit. This is where many investors should scrutinize and inspect. In Chicago area I wouldn’t buy a house in a flood zone if it was a $1. Constant flooding and water problems are not worth it and tenants don’t want to live like that either.

@Chris Titcomb at least with a projected offering price of 300K+ with add ons and a parking space. I wish it was as simple as a remodeling flip, other than the shell 90% guy rehab with a project $3M in profit everyone would be doing these if it was that simple.

@Chris Titcomb well that's sound lovely but as you know a project like this will cost approx $3.5M my guesstimate with ARV without upgrade to any of the units base price would conservatively approx 6.3M or $7-7.5 M with upgrades I'm having my appraiser run all the number for comps and arv to leave no room for mistakes. It's just when your doing projects of this size I get nervous sorry I nerves of steel but still get a little nervous. I always say your first big mistake in RE will be your last. So I make sure that I'm on point with the numbers.

@Chris Titcomb also correct I need the capital and or partner for the project. I could sell when I want or continue to rent and collect but I want to have an exit strategy less than 5 years for me.

@Chris Titcomb correct it is way below condo quality and size so basically they will be a complete gut rehab the entire building.