All Forum Posts by: Hamill Alex

@Evan Polaski

Thank you. This is logical. Your market is probably more similar to mine than Silicon Valley. If there is a “recession” or “depression,” the dilemma for me is to buy up cheap real estate, or retain that $ for operating income in case people can’t pay rent....? Who knows what the unemployment rate will do and how quickly people can/will go back to work, but any insight on this line of thinking would be appreciated.

Hello,

I’m interested in hearing from people who had portfolios during 2008. Some insight on what to expect, things to think about and general planning would be awesome. Who knows what’s going to happen and I would like to prepare for the worst.

1. What did rents do? Decrease? Stay Stagnant?

2. How were section 8, voucher programs and government subsidy apartments affected?

3. How does the unemployment rate affect the rental market?

@Drew Rehman

I don’t know about zoning in your specific area, but you can have tiny manufactured homes delivered on trucks. There are two types. Those that are built on trailers and thus have wheels. These are certified the same as an RV and you wouldn’t want them. The second type, is a prefab tiny home ready for foundation. You would pour the foundation, tie into the sewer and have electrical ready. Then, plop that bad boy on top of the foundation. If your plan is to rent both units, then the appraisal should be relative to the gross rent. I would call an appraiser in your area and ask what their gross rent multiplier is. This will help get a good evaluation of what it will be worth. Figure out the rents and essentially move backwards.

@Emily Lange

Hello Emily,

This plan would work, but living down the hall from people you don't know would get old for me. It would also be more difficult to manage moving forward. I like the multi-family suggestions below, but I would also look at current zoning laws regarding ADU's. Maybe you could turn a garage into another unit and live in that while you rent out the main. Usually, there are lot requirements for an ADU, but as a primary residence this is a creative solution.

@Brenna Crowe

Everyone has their own opinion relative to the amount of risk they are comfortable with. If you’re that successful with flipping and can continue to make that margin you should be able to do both. (Pay of student loan debt and flip.) Considering where we are at in the life cycle of the market, I would personally be apt to paying off my debt and only doing deals with a short turnaround time. Paying off debt will also provide a better debt-to-income ratio moving forward when you’re looking to use residential financing for longer holds. You would have a much better platform to scale with when the market takes a turn. I would also have a backup plan for your flips. Meaning, choose properties that could sustain a 15-20% drop in the market and still allow you to break even. Good luck.

@Andrew Postell

Genius. Thank you very much. We shall see how it goes.

@Andrew Postell

I spoke with a lender who told me that if I did this, they would see the property was sold to the LLC say 4 weeks prior. They would then look to find the owners of said LLC and see that I was an owner and that I would still be subject to the 6 month seasoning. Is this true?

@Andrew Postell

Thank you very much. I read section 3, but I'm not as experienced with this. So basically, I go to the court house and record the loan as if the LLC is the hard money lender to me personally. Then, the conventional lender sees there is a loan on the property and will refi it? So the difference is that this is a refi of a current loan and not a cash out and a normal refi like this does not have a seasoning period? Seasoning periods only apply to cash out refi's?

@Andrew Postell

Hi @Andrew Postell,

This is great. I currently have the duplex within an LLC. Could you elaborate on "lend the mortgage via the LLC." If the 6 month seasoning period is federally mandated, how would this circumvent these guidelines. I guess I'm missing something. Please help and elaborate on what exactly I should do once all the repairs are done and it's still in my LLC. Thank you very much!

I’m currently in the process of brrring a duplex . It’s the first I’ve done where I’ve actually purchased in cash and plan to cash out refi. However, I have already identified multiple

properties to buy after this and don’t want to wait the 6 month seasoning period to get my cash out. (6 months is federally mandated.) Any creative ideas to circumvent 6 months seasoning for residential financing? If not, what’s the feeling on using a commercial loan for residential properties at a 5, 7, 10 year interest reprice.