All Forum Posts by: Hoi L.

I have done 3 rental properties under DSCR loans/refinance (LLC owned) with comparable rates but lower loan package (only about $160-180k each) during the past 2 months. It went from 4.5% 30yr fixed to almost 6% in the course of 2 weeks in mid-Feb. We also have comparable credit scores and such. Rates are about 1/2 point lower if you increase the down payment to 25% and larger loan size, like yours.

Are they able to show you the time to recoup the points paid to lower 2% interests?  7.5% is high, but 2 points to buy down 2% points are also not too bad (I know it is over $10k).  Another lender that I am no longer using offered me $4,900 (over 2.5 points for a $180k loan) to buy down from 5.9% to 5.5%.  I said no thank you.

Added to my list!  The preview looked gruesome...

Congratulations on your first REI property! Since you are in the acquisition phase of your REI, concentrate on acquiring more capital in order to continue buying more properties. However, you need to refinance at a rate to ensure continual +cash flow. May not be $500/door, but $100/door after cap-ex, vac, R&M, etc, is the way to go.

The BiggerPockets calculator is useful to give you a ballpark range in the next property.

 Thank you for your response.  There are a total of 8 people occupying 5 units.  My SHF (3bd/1.5ba) with 5 people (2 parents, 3 children) and laundry only use 30 gallons/person/day.  This place is using 79 gallons/person/day.  During inspection, I know 1 toilet is running (has to be flapper, planning to replace the toilet), but a house without laundry and almost 80g/person/day is really kind of crazy.  From what I am seeing on rental classifieds, and my nanny's search when she was looking for an apartment for herself (1 bedroom), the market rate in similar neighborhoods are $850-1000 with heat and water.  So each unit here may be almost $100-150 below market to be conservative.

Thanks so much for your insightful advice with your experiences too!

Good day fellow members! My family started the REI pathway late 2021 and has closed on 2 SFH, 1 pending SFH, and one 5-unit multi-family house. Some details on the multi-unit located in Glenolden (SW suburb of Philadelphia):

Old (early 1900s), 2700 sq ft, converted to 5 units with 6 separate electric panels/meters

Only 1 gas meter, 1 gas hot water heater, 1 gas furnace heat (old fashioned water radiators)

Tenants on lease (month-to-month) have been there: 15 years, 11 years, 7 years, 2 years, 1 year

Tenants only pay electricity; current landlord/owner pays water/sewer/trash (standard for the area); heat and hot water (only 1 gas line and hot water heater).  With water bill usage that is outrageous (80g/person-daily; no laundry in house!), and monthly gas is >$200/month and water >$275/month.  Already planning to replace every old toilet in the home to newer low volume/high efficient models.

Their rents (two 1-bedrooms, two efficiencies (one definitely is easily converted to one bedroom), one 2-bedroom) are all under rented (currently $710-810/unit: market is $850-950 and higher per rent-o-meter)

Big question regarding rent: the tenants did not have rent increased for past 2 years (usually built in $10/yr), and I am planning to increase rent on 7/1/2022 by ~$50/unit (6-7%) after my acquisition on 3/28/2022.  Is this too much?  Do I need to justify with showing them the bills to water and gas?

Big question regarding utilities:

1. Should I also install electric tankless water heaters to each unit?  Or hire a plumber/electrician to separate the basement gas hot water heater to 5 separate electric hot water heaters?

2. Would changing out the gas stoves (4 out of 5 are gas) to electric be worth it?

3. Should I install community laundry to the basement?  The long-term (15 years) tenants asked about it and she says it would be the biggest improvement to the house, "Even if it is coin-operated, you would make it back in no time".

4. Is it worth separating out the gas line to 5-6 and let tenants take over the gas bill?

thanks for all and any advice-help

 Great to know, and that's why I asked that question knowing that he switched "places" after she signed with him several months ago and cannot now find the original signed contract on DocuSign.  Going to find out

 I have thought about that too, but I also hate giving him what he wants, which is getting paid without doing anything.  I still cannot believe how shady he was in getting the seller in accepting an offer from someone whom he also was representing without pre-approval and while knowing the previous buyer would never be able to get a loan (no reported income in at least 12 months).  In trying to get both the commissions, he screwed the seller.

@Jon Kelly  I had related to the seller that I like her property and was amazed that it has not sold yet.  She knows that if there is a chance of this deal not happening, it is because of her agent.  

@Theresa Harris Thank you for your advice.  The seller told me that after she signed the contract with her agent, he switched brokers and all her previously signed DocuSign socuments "disappeared".  She checked multiple times and they just were gone (she told me she wants to review the contract to see how long she is "stuck" with him).  Since he switched brokerage, wouldn't she be cleared?  Not sure what the contracts between seller to the agent or to the brokage.  Thanks

@Joe Norman Funny that last night, the seller texted me directly herself that she had fedex the leases to me directly "In case (her agent) cannot get to it".  In reply, I did texted and asked clearly of the seller yesterday, "Is it alright for me to text or talk to you tomorrow after I receive the leases that you overnighted to me?".  She replied, "You sure can".
My agent and I both know that MY agent cannot communicate with the seller, but as long as the seller is open (probably preferred by her) to communicating with ME, then all is koshered.  
Thank you for your advice.