All Forum Posts by: Jonathan Taylor

@Christian Romero A few points first.

Cash for keys in LA county is not as easy as other states. You have to follow HCIDLA's guidelines and the current cost is 23k+ per person (not tenant). Even if the tenant signs the CFK document and sets a time to move out, if they dont, you have no ability to enforce the contract. Its a tenant free for all state. Keep that in mind

Second, this is a house hack scenario but some of your intended plans are over developing without ROI. ADU, parking, common area - good idea, Garden and solar, not so much.  Since tenants pay for utilities, no sense in adding solar cost when you wont see a return. I tried tenant gardens on my house hack and it cost me (tenants leaving water on, attracting wild animals, wasn't taken care of, list goes on)

Lastly, what is your plan for funding? This is a huge endeavor (if you can get it under contract and tenants out) to do in LA. If you do not own any real estate, Look into the NACA loan program. I used it to buy my triplex + ADU.

@Roy Gottesdiener Read @Rick Albert 's post, the benefit is in the details. I don't know the specifics of where the line in the sand is for you regarding the benefit but I live in a high cost of living area. House hacking has allowed me to have a mortgage subsidy (units paid most of my mortgage) at the start and over time, are now covering all of it. 

@Jose A. Ramirez Happy to help but can you provide a bit more detail? Residential or commercial property? How many units? Is it stabilized? etc. 

@Paul Meyer I hope you find a solution but there are two problems with what you are asking. 

First, a 30 yr mortgage at 5% is an unrealistic ask considering conventional market rates are higher than that, even with my lenders at 50% LTV. DSCR loan would be your way to go because I do not know of any lender, private or public, who would lend at that rate that you are asking. Second, the location tab at the bottom of your post states Vermont. If the property is located in that state, VT only allows in state lenders to lend on real property. Best is to ask lenders in state.

Side note, lenders denying lending because it is rural and a manufactured home is a perfectly acceptable reason to not lend. The location an asset class has a higher risk most lenders are not willing to take on.

@Rajul Vora This market uses two types on income to UW a 1-4 unit residential property. Long term rents or short term rents (anything less than 12 months). MTR and rent-by-room are not a metrics lenders use to qualify income. The reasons being, rent by room is technically a boarding home style of operation, think halfway house, elderly care facility, childrens home, etc. 

If the property cannot be purchased using appraised long term rents to debt cover at 80% LTV, try to qualify the loan under ST rental numbers, IF your market has an abundance of ST comps. STR loans qualify similar to LTR, and with the usually higher monthly rents from STRs, the lender can leverage higher loan amounts.

@Jake Nilan Can you provide a few details? What type of property do you have (1-4, 5+, mixed used, etc) what your goal is, if the property is fully leased and stabilized, etc. 

With these specifics, we can better guide you since your question is too broad at this stage. 

@Allen Wu can you provide more details? Specifically the property type, unit count, LTV, etc. With all the info we can help you better.

@Ayyoub Feza depends on what loan you will be using. If conventional, whomever has the higher income and lower debt for DTI purposes. For a DSCR loan, whomever has the higher FICO score, i since these loans use FICO, Experience and property numbers to determine rate and LTV.

@Jose N. you may have an issue with the low values of each property and the zip codes like @Michael Smythe metioned. One other question is, what is your plan with the properties and are they 100% rent ready? 

Portfolio loans have restrictive release clauses. In case you wanted to sell one of the properties, it would be costly to release it from the blanket lien. Second, with some portfolio lenders, if one or more of the properties need work or isnt rent ready, they would require the work to be completed prior to close. 

@Juan Zamora Typical DSCR loans use long term rental leases or appraised market rents to qualify
STR loans use in place (if ST rented for 12 months) OR market data from Airdna, local STR operators and the like, to qualify the income.