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All Forum Posts by: Jalen Greenlee

Jalen Greenlee has started 5 posts and replied 15 times.

Post: Private Investor Refi or Suggestions on How to Move Forward

Jalen GreenleePosted
  • Rental Property Investor
  • Milwaukee/Madison, WI
  • Posts 17
  • Votes 4

Hey!

Last month, my wife and I purchased a fantastic duplex in Madison, WI, for $400,000 using an FHA loan. Our plan was to do the traditional house-hack, but things haven't gone as planned.

During some self-testing followed by professional testing, we discovered lead in several high-traffic areas of the home. Since the house was built in the 1940s, we should have tested for lead during the inspection. Unfortunately, we weren’t fully aware of how severe this issue could be, and now we’re facing the consequences.

The Current Dilemma

My wife is pregnant and due to give birth next month. The lead issue, coupled with an overall discomfort with the neighborhood and the home itself, has significantly impacted her mental and physical well-being. Naturally, she wants to be in a more comfortable environment to welcome our son into the world.

However, there's a legal hurdle. With an FHA loan, we're required to live in the property as our primary residence for at least one year. The only way to bypass this requirement legally is to refinance into a conventional mortgage. Unfortunately, we can't do this for another 200 days due to FHA restrictions.

Exploring Alternatives

One potential solution I’ve considered is working with a private lender. Here’s the idea:

  • A private lender could pay off the FHA loan, allowing us to give them the first lien on the property.
  • This would free us from the FHA restrictions, enabling us to move to a more suitable living situation while addressing the lead issue at a later time.

What I Need Help With

  1. Private Investor Leads: Does anyone know of private lenders who might be interested in exploring this option?
  2. Other Suggestions: Are there alternative strategies I haven’t thought of that would allow us to move legally and responsibly under the current circumstances?

We’d deeply appreciate any advice or insights. This situation has been incredibly stressful, and finding a viable path forward would mean a lot to my family.

Thanks in advance for your help!

Post: Advice on Obtaining Rehab Funds for Owner-Financed Deals

Jalen GreenleePosted
  • Rental Property Investor
  • Milwaukee/Madison, WI
  • Posts 17
  • Votes 4

Thank you for this helpful advice! 

Post: Advice on Obtaining Rehab Funds for Owner-Financed Deals

Jalen GreenleePosted
  • Rental Property Investor
  • Milwaukee/Madison, WI
  • Posts 17
  • Votes 4

Hi everyone,

I’m currently in the process of closing on two owner-financed small multifamily properties in Milwaukee, WI, which I plan to buy and hold. While I have the funds for the down payments, I’m in need of approximately $30,000 to cover the rehab costs for these properties to get them in market rent shape.

I’m exploring various options to secure the necessary financing and would greatly appreciate any advice or recommendations on the best ways to obtain rehab funds. Has anyone here had experience with this, or can you suggest any lenders or financing strategies that could be helpful?

Thanks in advance for your insights!

Post: Looking to build my team. Any referrals to the following

Jalen GreenleePosted
  • Rental Property Investor
  • Milwaukee/Madison, WI
  • Posts 17
  • Votes 4
Quote from @Drew Sygit:

@Jalen Greenlee

Recommend exploring as many sources as possible to get referrals AND cross-reference them to get as much accurate information as possible.

Check out NARPM.com, BP’s Property Manager Finder (BiggerPockets: The Real Estate Investing Social Network), etc.

Also, encourage you to learn from the mistakes of others - by reading posts here on BiggerPockets about owners not having their expectations met by their current Property Management Company.

To avoid going through the same poor experience, keep reading.

Even if someone gives you a referral here, do NOT make the mistake of assuming that the PMC will meet your expectations, just because they met the expectations of the referral source.

In our experience, the #1 mistake owners make when selecting a Property Management Company (PMC) is ASSUMING instead of CONFIRMING.

It's often a case of not doing enough research, as they don't know what they don't know!

Owners mistakenly ASSUME all PMCs offer the exact SAME SERVICES and PERFORM those services EXACTLY THE SAME WAY, so price is the only differentiator – so, they often select the first PMC they call or that calls them back!

So, the first question they usually ask a PMC is about fees - instead of asking about services and HOW those services are executed.

EXAMPLE: PMC states they will handle tenant screening – what does that specifically mean? What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.? You’d be shocked by how little actual screening many PMC’s do!

This also leads owners to ASSUME simpler is better when it comes to management contracts.

The reality is the opposite - if it's not in writing then the PMC doesn't have to provide the service or can charge extra for it!

A well written management contract should clearly spell out what is expected of both the PMC and the owner, to PROTECT both and avoid misunderstandings. Why do you think purchase contracts are so long and have such small print?

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

 THANK YOU @Drew Sygit you are the man!

Post: Looking to build my team. Any referrals to the following

Jalen GreenleePosted
  • Rental Property Investor
  • Milwaukee/Madison, WI
  • Posts 17
  • Votes 4
Quote from @Rebecca Knox:

- Investor Friendly RE Agent: Premier Point Realty & Homestead Realty agents & Nick Knox III
- Reliable Contractor(s): Wisconsin Contractor & Handyman Club on Facebook
- Property Manager: Citywide Rental & Property Management, Welcome Home Milwaukee, MKE Leasing & Smart Asset
- Investor Friendly Lender(s): Too many to name but try Dennis at Homestead Mortgage--for hard money: Mach1 Lending, MGM Capital, Wisconsin Hard Money, The Hard Money Co/F-Street
- Title Company: Stewart Title, Land Title, Superior Title
- Wholesalers: me and join off market deals with details group on Facebook
- Insurance Broker: Bob Dummer at PC Insurance


 Thank you Rebecca! This is very helpful.

Post: Looking to build my team. Any referrals to the following

Jalen GreenleePosted
  • Rental Property Investor
  • Milwaukee/Madison, WI
  • Posts 17
  • Votes 4

Hey BP!

We are scaling our real estate business in South-Eastern Wisconsin and apart of scaling requires having a great team in place. As we build out our team, we are looking for the following referrals:

- Investor Friendly RE Agent
- Reliable Contractor(s)
- Property Manager
- Investor Friendly Lender(s)
- Title Company
- Wholesalers
- Appraisers and Inspectors
- Insurance Broker

If you have any South-Eastern Wisconsin referrals to any high level and high performing individuals/companies, it would be much appreciated.

Love you all! ❤️🏠

Quote from @Nick Harrington:

Hey Jalen - 

I work with a lot of investors in Milwaukee, and also am an investor myself here too. 

On paper and in practice, the BRRRR strategy is great. Phenomenal CoC returns, recycle your money, ability to scale, etc.

For Milwaukee specifically, the most difficult part of doing a BRRRR here is finding the deal. For any property purchase, the deal is made when you buy, not when you sell. The majority of inventory in Milwaukee that is listed on MLS as an "investor special" or with "value add" etc, typically does not have enough spread to exit a deal with no money down post refi.

The common rule talked about with BRRRR is the 75% rule (you want your purchase + rehab costs to be 75% of the ARV). If you find a deal like this, typically you can leave no money in the deal post refi.

Where I see most deals priced on the MLS now are going to be 85% - 95% deals, meaning that post rehab, you have created about 5% - 15% of equity.

Your best bet to find a BRRR deal (or even a flip deal) is to connect with off market resources (wholesalers, agents that specialize in this space), or to cut these people out and source deals yourself. Door knocking, postcards, cold calling, etc. are going to be the best bet for finding something that is going to hit the numbers you need.

 Thank you @Nick Harrington! The off market resources tip is very helpful. Where do the wholesalers hang out? lol

Quote from @Marcus Auerbach:

Well, here is an answer that's not from ChatGPT.

Let appreciation do some of the heavy lifting for you. It used to be much easier to find properties that were discounted for condition. Milwaukee inventory has been so low since 2021 that sellers don't have to offer a discount for condition, some uber- motivated first-time home buyer will pay full fare. 

The flip side is you have now a tailwind from considerable market appreciation that can do some of the heavy lifting for you, so by the time you are done with your rehab (forced appreciation) the market will have also moved on. Pick your projects accordingly.

 This is very helpful Marcus! I definitely have noticed properties increasing in value a little more rapidly recently. @Marcus Auerbach

Quote from @Jake Baker:

@Jalen Greenlee

Here are some BRRRR nuances that I have learned along the way:

It is easy to underestimate your rehab budget. - make sure to get bids from multiple contractors and have adequate reserves.

It is easy to overestimate your ARV. - Have an agent pull recent comps for you

It is easy to underestimate the timeline. - whatever a contractor says, add 4 weeks.

It is easy to underestimate loan costs. - look at previous settlement statements or get an estimate from your title company.


 Thanks Jake! Do you have any tips on finding solid/a number of contractors? This has honestly been one of the deterrents of me moving into this space.

Quote from @River Sava:

Hey Jalen, 


I agree with John. A BRRRR can be done in nearly any market if you have the right tools / gameplan. Check out this BP article that sheds further light on this topic. Also, feel free to reach out with any questions!


 https://www.biggerpockets.com/blog/brrrr-loans-what-are-the-...


 Thanks for the resource River! Much appreciated.