All Forum Posts by: Jan Kutrzeba

Hey BP family,

Do my numbers make sense to you? Stabilized value add.

Fully occupied 6-unit in SATX asking/purchase price $340k ($56.7k/unit) all CASH.



Annual

gross income $52,500

LL paid utilities $9,600

taxes $4,356

insurance $2,880

Mngmnt $4,200 (8%)

Maintenance $5,250 (10%)

NOI $26,214

CAP 7.7%

1% rule 1.2%

Buying with hard money > REFI with 25% down, 4.5% interest, 25y arm 5y balloon.

Would love your feedback, thank you!

Good to meet everyone! Newbie in MFH here and new to Texas. Looking to enter the MFH arena this year. Currently studying, analyzing, talking to lawyers, mortgage brokers, etc. building a Team. Hope to make it on the 4th! 

@David M. Thank you so much for a very thorough response! I haven't found a good book geared towards investors that'd break down the most commonly used legal strategies when starting out, step by step. Maybe you have some recommendations? Like you wrote, there is no "right" solution to these. 

Thank you for including links to your BP posts - I'm looking fw to reading them.

Is $400/h a reasonable rate for an experienced CRE atty? $400-$600/h has been the range here in Austin btw the three attorneys I've reached out to.

Very interesting idea about each one of us forming our own separate LLCs. I'll need to bring that up next time we speak to an attorney. We'll definitely be looking for capital in the near future in order to scale, whether from future partners or passive investors. Thanks again for the link to yet another post!

@Greg Dickerson Thank you! Waiting to hear back from our mortgage broker regarding my partner's residency, and other topics.

Hi BP,

My colleague and I have started taking the next steps to forming a partnership and purchasing our 1st MFH by the end of Q1 of 2021. At the moment, I’m looking for deals, underwriting, talking to brokers and sellers, building the Team. My future partner has more of a passive role and resides abroad . We’re both coming with equal amounts of capital for our first deal. We are looking for stabilized, 6-12 -unit value-add C-class properties in C-B- areas in the ATX and SATX markets.

I have a couple of questions about the timeline for setting up a legal entity (LLC or series LLC) and seeking financing. What's your experience?

- is it easier to get financing as an existing entity (LLC or series LLC) than as two (or more) individuals? >>> does it behoove us to form an LLC before we seek financing? Or is it a requirement?

- does our place of residence have any significance when it comes to getting approved for financing? My partner (US Citizen) currently resides abroad.

- have you experienced problems with series LLCs? An attorney we spoke to recommended the series LLC for legal protection but mentioned that some lenders have a problem with it.

- is getting a loan on a 5-unit and larger easier than a 2-4-unit if the purpose is the same (investment)?

- would it make it any easier if either of us were a licensed real estate agent in the State the property is located? I’m currently a licensed agent in NYC but we’re looking to buy in TX to start with.

- can part of the down payment be borrowed money, eg. hard money, or cash advance from a credit card? How does this affect the primary lender’s criteria? Can we use hard money or other borrowed funds on a down payment with seller financing?

- what’s the best way to find reliable hard money lenders?

We’ve spoken to a RE attorney and I’m talking to a commercial mortgage broker, but would love to hear from y’all about your experiences.

Thank you and keep on working hard (and smart)!

@Greg Dickerson thanks for these!

@Nikki Closser

Amazing!! Congrats!

@Gaby Liu that sucks BIG time - I'm so sorry!

For me, the idea of flipping a property OOS seems doable but very risky without having someone with real skin in the game on the spot to run the show. Nobody's gonna care about my business as much as I do.

I've had success with holding an SFR rental OOS. However, now that I'm trying to get some work done on it, I see a big potential of being 'effed over'. On a recent small job, I had to keep chasing the contractor and (although I've asked him to send before/after photos) I can't reliably inspect the quality of his work.

My experience with contractors I've talked to has been blaming the previous guy for doing it wrong and that they can fix it but are unable to give me a detailed quote. A lot of fear mongering, a la "if you don't fix this asap your house is gonna fall apart". I've learned to take these with a pinch of salt. 

That said, I'm about to start reading Jay Scott's book on estimating rehab costs to get a better understanding on what things cost to repair/replace. This alone should give me a great advantage when negotiating with contractors. 
 

Hi everyone, I'm new to Austin and have one rental property in Allentown, PA but looking to sell and get into MFH here in ATX and/or SATX. I'll be working until 8pm but will try to follow as much as I can. 

@Matt Stricklen thanks for organizing!

Thanks for sharing! Amazing and super inspiring! IT IS POSSIBLE!!! I currently own a cashflowing SFR but I knew from the get-go that MFH is the way to go and I'm in it for the long run. Currently looking to exit out of my SFR and find my first MFH here in the ATX-SATX area. Podcasts, books, underwriting properties, talking to ppl. I sometimes fail to acknowledge how much I know until I start explaining REI to a newbie and realize that I have a wealth of info - us RE junkies all do! But ACTION IS KEY!!! Keep grinding y'all!