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All Forum Posts by: Hitanshu Shah

Hitanshu Shah has started 13 posts and replied 35 times.

Post: Investors using Hemlane for KCMO Properties?

Hitanshu ShahPosted
  • Investor
  • Monsey, NY
  • Posts 37
  • Votes 10

Hi All..Currently own a 4-plex in the KCMO Area and I am wondering if any investors have experience with Hemlane for properties in the KCMO Area. I know their SW Platform is good but how about the pool of Maintenance contractors/ability to solve tenant issues in a timely manner etc. I am looking for a PMC in KCMO and am evaluating Hemlane. 

Thanks

Hitanshu

Thanks All for your responses. We have notified the current PMC of termination, and the company has agreed to work with us to come to an amicable resolution on open issues. Let's see how it goes. We have also started the due diligence process of selecting the next PMC. Any PMC suggestions for this area would be great. The property is in Rivertown, MO. 

Own a 4-plex in the KCMO Area. The Property Management company has breached the contract in terms of allowable expenses without owner's approval. I am also having communication issues with this PM - no email responses for days. Other lapses include forgetting to include utility fees in a new lease which was previously discussed with the owner but the new lease got signed by an existing month to month tenant and was not shared with the owner before the tenant and the PM signed it! I am an out of state Investor. What are my options ? including legal options if I need to go that route to recoup my losses? 

If we go with a 30 year fixed traditional loan, how do we get legal protection? With 30 year fixed traditional loan we can only acquire it in our name and I hearing the deed trasfer after closing to a LLC does little to really protect the owners. Thanks

Quote from @Stacy Raskin:

Since it's an investment property a DSCR loan can be a good option as there are 30 year fixed options and the rents will be used to underwrite the loan. DSCR loans won't use your income to underwrite the loan.

DSCR loans are based off of down payment, credit score and either actual or market rents so it helps to supercharge an investor's real estate goals and net worth.

Here's a bit more in detail about how rates are calculated for DSCR loans:

1. Credit score- the higher the best. 780+ generally gets best pricing for investment property loans with most lenders. From there every 20 point increment affect pricing differently. So for example, a 761 credit score will be in the 760-779 credit category, then going down to 740-759 and so on.


2. Loan to value ratio: The higher the loan to value ratio (LTV) is, pricing takes a hit. So your pricing will be higher for a 80% LTV loan than for a 60% LTV loan.

3. Prepayment penalties- usually 1-5 year terms. The shorter the prepayment term has an impact on increasing the rate.

4. Are you cash flowing the property? More on how that is calculated below. Is your DSCR ratio greater than 1-meaning are you cash flowing (according to the lender's criteria of mortgage, property taxes and insurance (and HOA) if applicable). Many lenders will not do a DSCR loan unless cash flowing. If they will do a loan with less than 1, the pricing takes a hit. This criteria is for 1-4 and 5-8 unit programs.

I've included an example below to help illustrate this.

So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.

See example below:

DSCR < 1

Principal + Interest = $1,700

Taxes = $350, Insurance = $100, Association Dues = $50

Total PITIA = $2200

Rent = $2000

DSCR = Rent/PITIA = 2000/2200 = 0.91

Since the DSCR is 0.91, we know the expenses are greater than the income of the property.

DSCR >1

Principal + Interest = $1,500

Taxes = $250, Insurance = $100, Association Dues = $25

Total PITIA = $1875 Rent = $2300

DSCR = Rent/PITIA = 2300/1875 = 1.23

If a purchase, you also generally need reserves / savings to show you have 3-6 month payments of PITIA (principal / interest (mortgage payment), property taxes and insurance and HOA (if applicable). If a cash out refinance, many lenders will allow the cash out to satisfy the reserves requirement.


DSCR lenders generally let you vest either individually or as an LLC. It's a great way to increase your net worth and these loans can also be used to pull cash out of a property as it appreciates allowing you to reinvest money into new deals.

Happy to connect to discuss further. 


 Hi Stacy...Thanks for the explainaton..Have left you a message to discuss more

Quote from @Erik Estrada:
Quote from @Hitanshu Shah:

Hi All

We are under contract on a 4-plex and I am shopping for Loan options. The purchase price is $415 K and we can put 20% to 25% down. Few brokers have recommended a 5 year Balloon loan but I want to explore the best option available in the market currently. 

Thanks


If this is an investment property you can get a DSCR loan on a 30 year fixed rate (no balloon).


Hi Eric..Can we connect today? Would like to know more about DSCR Loan funding. I am on the East coast. I saw you are in CA..so will call you later. Thanks

Hitanshu

This property is non-owner occupied..with 4 tenants and steady rents.

Hi All

We are under contract on a 4-plex and I am shopping for Loan options. The purchase price is $415 K and we can put 20% to 25% down. Few brokers have recommended a 5 year Balloon loan but I want to explore the best option available in the market currently. 

Thanks

Post: Syndication Deal Analysis

Hitanshu ShahPosted
  • Investor
  • Monsey, NY
  • Posts 37
  • Votes 10

Hi All

I am looking into investing with Holdfolio on a syndication deal they have DoveHill Investment for a Hilton, Homewood Suites property in PA. Have anyone invested with Holdfolio or DoveHill before? 

Thanks

Post: Syndication Deal with 37 Parallel Properties?

Hitanshu ShahPosted
  • Investor
  • Monsey, NY
  • Posts 37
  • Votes 10

Hi Everyone...Has anyone dealt with a syndication company called 37 Parallel properties recently? 

Thanks