All Forum Posts by: Jason Howell

Hi Christopher!

I would say that both my wife and I feel like it was totally worth it for us. It got us motivated, organized, and ready to begin our investing and we hit the ground running with five properties in one year. 2019 has been quiet, no acquisitions this year, really just focused on some debt paydown, saving, and monitoring the portfolio. The ProVision process helped us feel confident that we could do it, and I'm certain there are plenty of people who might not NEED that kind of assistance in order to do this, but it really did help us. The team continues to handle our yearly taxes which we appreciate and they are always available to chat about things we are unclear about so we can keep learning year after year how to continue our progress and to learn from our mistakes.

Fantastic responses and makes perfect sense. When I run the numbers on the higher interest rate, it doesn't really affect my cash flow too significantly. It's already a pretty good COC return to begin with, so I will go ahead and accept the higher rate. It's so easy to get locked in the mindset of "lowest possible interest rate"... but I also have to remind myself that interest rates *may* be creeping up, but they are still phenomenal comparatively speaking.

I hadn't even considered the refinance aspect either, @Mark Creason. Great point. And thanks for the detailed explanation @Joe Villeneuve. You guys are awesome.

Working on a loan for a duplex that I'm psyched about. I'd love your thoughts on paying down interest rate up front with points. I'll use an example with similar numbers because I want to truly understand the reasoning here:

On the high end, the interest rate would sit around 5.75%, at the cost of -.125 points (ultimately resulting in a lender credit of $164) and a P&I of $766 per month ... on the low end, the interest rate would be 5.375% at the cost of 1 point (around $1300) with P&I of $735 per month.

Given that info, this is to say that if I planned on holding onto this property more than 42 months (that's $766-$735= $31 per month... then $1300/$31=41.94 months), then it would make financial sense to pay down the percentage rate up front at 1 point because beyond 42 months, I'd be saving money every month... If my plan was to hold onto this short term (let's just say 2-3 years out of thin air), it makes no sense to pay the point up front and I would opt for the higher percentage rate per month.

I know I've heard/read that some people would argue that it rarely ever makes sense to pay the point up front, but if its a long term play, I don't truly understand why that might be...

Any info appreciated! Thanks!

Working on a loan for a duplex that I'm psyched about. I'd love your thoughts on paying down interest rate up front with points. I'll use an example with similar numbers because I want to truly understand the reasoning here:

On the high end, the interest rate would sit around 5.75%, at the cost of -.125 points (ultimately resulting in a lender credit of $164) and a P&I of $766 per month ... on the low end, the interest rate would be 5.375% at the cost of 1 point (around $1300) with P&I of $735 per month.

Given that info, this is to say that if I planned on holding onto this property more than 42 months (that's $766-$735= $31 per month... then $1300/$31=41.94 months), then it would make financial sense to pay down the percentage rate up front at 1 point because beyond 42 months, I'd be saving money every month... If my plan was to hold onto this short term (let's just say 2-3 years out of thin air), it makes no sense to pay the point up front and I would opt for the higher percentage rate per month.

I know I've heard/read that some people would argue that it rarely ever makes sense to pay the point up front, but if its a long term play, I don't truly understand why that might be...

Any info appreciated! Thanks!

 Thank you so much! I will pass this along, this is very thorough and I appreciate the info!

A friend of mine has owned a very nice property in San Francisco for years now but is looking into moving out of the city with her family. There's a ton of appreciation in the home located in the heart of North Beach. Her immediate inclination was to sell but she's also curious about the idea of renting out the home and securing a solid property manager to run the place for her. I'm not entirely sure she'll go that route but she would like to talk to a few good property managers to test the waters.

Anyone have any recommendations that you can share?

Thank you!

Drats, I would SO do this but I have a work obligation that evening. The stars will align one of these times, but man this is exactly what I've been waiting for. :(

 Very informative, thank you! And I like how you call it "patient capital."

 Yeah that makes perfect sense. If the market cap rate is similar to this, then it's not outside of what you might expect... not amazing in its own right, but relatively on par with what everything else is seeing in that market. I guess then, one must ask themselves what Cap rate THEY wish to receive, and if the market cap rate is below that number, well, maybe that market isn't right for them and they should look elsewhere.

If market cap rates in a particular region are consistently low... how does anyone actually make any money in those markets? What would someone find appealing in those markets to make them decide to invest in it? Somebody has to own those properties... why would they choose to if the market cap rates are low compared to others?

Super impressive work here, and very inspirational that this is your first go. You gotta be excited about the direction you are heading. :)