All Forum Posts by: Graham Nash

BP,

My wife and I purchased our residence using a construction loan. Property was appraised, loan was made, closed on the property, funds were available for the repairs we wanted to make. Theses funds were based on the anticipation of the value of the property after the rehab was complete. Once all construction/repairs were done, there was a second appraisal. During the rehab we paid interest only and it was for 6 months.  

Is this type of loan available for commercial properties? Specifically a 12 unit apartment building that is completely vacant and in need of an 85% rehab?

Any options?

Thanks for any advice.

Graham

@Eric Marofske

Thanks for the feedback, exactly what I was hoping to get. You pointed out my mistakes and showed me how to correct them. Time well spent, thanks again.  

@Immanuel Sibero Thank you for your responses. They're concise, succinct  and relevant. I will definitely apply the knowledge you have shared. It's interesting to me how one person can say in 2-3 sentences, what another has tried, but failed to express in many. 

Immanuel Sibero from Carrollton, Texas

@Thomas S. I'm looking at a rent raise as a bonus. It seems a given, but not something I thought wise to bank on. 

Why would my coc go into the basement if it's based on NOI, which includes my monthly note?

Also, why wouldn't I want equity in the property?

Thanks for the feedback.   

BP,

I'm looking for some thoughts on this potential deal. I keep going back to it, not sure if it's because it has good value, or I'm just trying too hard to make it work. It's not listed on the MLS, but it was brought to my attention through a licensed agent. Here's the info I have so far…

32 units, all brick, 100% occupied, rent has not been raised in 10 years. Property is in very good shape.

Gross monthly rent $19,400 ($232,800 per year) 50% = $116,400

Asking price is $2,000,000

Cap rate=.058 = not a deal.

It’s the owner financing option that I keep coming back to.

The conversations I’ve had with the agent led me to believe the owner is flexible when it comes to terms rates, etc... He appreciates the monthly income, but his age will soon be a factor because he has self-managed since the properties were built in the late 60’s.

Here’s what I’m thinking…

Buy in for $100,000 down (my price) offer $100,000 per year for the next 19 years (his price).

Monthly numbers (Gross $19,400)

Note $8,335=$100K

Tax $850

Insurance $1,200

Cap X $1,950

Maintenance $1,950

Vacancy $1000

Management $1,950

Tenements currently pay water/sewer/trash

Total expenses $17,235

NOI $2,165 per month, Annual NOI $25,980

Cash on cash return = 26%

My question is this, at what point does the cash on cash return validate a purchase that has a lower than ideal cap rate? Or can it?

Feedback would be greatly appreciated, especially from those who are experienced.

Thanks for your time,

Graham

Greetings,

I'm looking to do some cash out refi's on 3 properties. 2 of the 3 properties have zero debt. I also want to put them into an LLC. I'm finding that seeking cash out refis on properties that are in an LLC  creates an issue with the banks. Is this all banks? If so, should I wait on the LLC until after the refi? I think that increases the likely hood of due on sale clause...

Thanks in advance,

Graham  

Thanks for the info! Looks like I have some homework to do... I'm going to start with figuring out my DTI. I have all of our expenses and incomes, but have never clearly defined our DTI. The difference btwn front end and back end DTI is some what of a mystery to me. Pretty sure I wont have to look far to find a good forum on the topic. Thanks again.

We just purchased and updated our 3rd single family investment property. We combined a HELOC and cash to purchase the property, around $36K invested. Now that the property is up and running, I would like to recoup my cash and reset the HELOC to its fullest amount. I'm not sure if this is even possible…Here's where I need your experience!

A conventional loan would be great, but I’m not sure if that’s possible since I own the property. It seems like I would be pawning the deed. So far I have the BuyRehabRent taken care of, but I’m not sure if I can refi a home that isn’t financed with a conventional loan.

I’ve seen posts that offer private/hard money lending, but they require a minimum of double what I would need. This could be a good thing… I have another property that is paid for and has relatively decent amount of equity. Could I possibly roll the 2 properties into one loan?

I’m looking for advice and suggestions from individuals who have EXPERIEMCE in these situations. My goal is to earn the greatest return on my assets without getting overextended. Thanks for reading and your time!