All Forum Posts by: Ian Bower

Thanks for input - He's insisting that because it's a DSCR loan, and because the size of the deal is too small to go into their "Portfolio Loan" product, that it has to be two separate loans.

My real estate agent thinks he's nuts, but she has more experience with conventional loans than DSCR. 

I made an offer on a double, it turns out that it's on two parcels with two separate tax cards but deeded together. 

My loan officer seems to believe this means that I need two separate loans, sales agreements etc... 

My Real Estate agent believes that they can be sold together since it's a single deed... 

While they go back and forth, I wanted to try and educate myself on the situation. 

Can anyone here provide some insight? Since it's a single deed it seems to me that it would only make sense to do one loan/deal. 

 Thank you! I appreciate your answer. 

Thanks Rick! That was the encouragement I needed. I switched to a different marketplace about 2 hours from me and I am already seeing more promising opportunities. 

Thanks Jonathan, 

I've been in about 10 properties in the last week, so I'm definitely on the ground. I am using CAP rate as a comparison between properties, also using ROI.

Here's an example of what I am finding, note that the higher ones (the one in bright green for example) represent wishful thinking. ex. "If I can convert that garage into an ADU" or "If I can figure out how to get rents higher..."

What would you recommend for me to use to determine the quality of a deal? I think that is what I am asking more than anything.. I am using CAP rate to compare different properties, and ROI to determine the best use of my capital.

So for example, Row 3 on this sheet seems great (It's one of the "hopeful thinking" ones though). 

Hey all, 

I've been looking for my first investment property in my local marketplace (2 hour radius around me) 

Here is what I have been finding for the most part... 

SFR - Low cap rate (3% or so)

Multi-Units - 10% Cap Rate, but poor condition*

Multi-Units - Low CAP rate, tenant occupied*

I understand my options for fixing things up at a property, but here are the issues I am running into.. 

*Tenant occupied properties usually have below market rent, often VERY below market. If the rent matched market prices it would be a good deal, what should I do here? 

*Tenant occupied properties that need a lot of work - especially when combined with my point above. I can't renovate with a tenant in the property, especially if they are paying below market rent.

I DO find some properties that are in good shape, even tenant occupied that have a low cap rate - or SFR that have a low CAP rate - Should I be considering these properties?

So I guess overall, my question is can you help me align my expectations with what I am finding, is this a case of "yeah, the market is weird right now, this is typical, you have to make a decision" or... "Look harder/Look differently"

Thanks!

FYI I think that low CAP rate is sub 5%, please correct me if I am nuts.

 This was a lightbulb moment for me. Are origination fees just an interest rate buy down? 

 I don't have an official estimate but the lender is saying to expect 7.25% maximum, but more likely more like 6.8-7%

 Hey Jay - I too am asking why :D 

My only experience has been with conventional mortgages - I recently purchased my own home with one and since I am a small business owner it was like pulling teeth. 

The DSCR loans seem much easier to qualify for, but perhaps there are other loan types out there that are less expensive and also aren't a root canal? (the way the conventional mortgage was a root canal)

I am probably going to pay cash for the property upfront and then finance it after the close, so I have some time to explore financing products. 

Thanks - It's a $120k loan (ish)