All Forum Posts by: Jean G.

@Skyler Smith

I was reading some of my notes of previous calls with banks. What type of rate should I expect for a LOC? I show several banks that offered 5+% rates on real estate secured LOCs, yet US Bank has a 5 year term loan with a 1 year rerate (in other words an ARM) that starts out around 2.25% at current rate levels.

So if US Bank can do that on a term loan, shouldn't I expect to find LOCs at similar rates, or is it now how it works?

@Robert Sepulveda

 Thanks a lot for the info on the conventional underwriting guidelines. The one lender that declined to do a refi on a 2 year old transaction didn't tell me that it would have been possible within 6 months. That's good to know.

@Skyler Smith

Yes good idea on the LOC. I actually also asked around about this but didn't find anyone offering this with decent terms. I guess I just need to call more banks. There are plenty where I am. I'll just call 2 or 3 every day...

But I still need a solution to refinance out of each cash purchase, ideally with a decent 30y fixed rate...

@Darren Eady

I filled out a lead form with Peak Asset Lending but the brochure that was auto-emailed to me talks about 3/1 ARMs (so it's possibly a 30y loan, but interest resets after 3y). I'll see if I can find out more when I talk to them...

I just did something like this for me an my wife's Roth IRA through a "checkbook" SDIRA. The Roth IRAs are both transferred to the same custodian, and they both become members in the same purpose created LLC, which then opens a checking account that gets funded with your IRA moneys, and from where you do your investing.

What's important in that setup is that once the 2 IRAs have invested into the LLC (each IRA is a member in proportion to the amount invested) you can never add more money into the LLC with future IRA contributions because the LLC becomes a prohibited party after it gets funded (or this is what the lawyer explained anyway). If you get a lot of contributions over the years, you could always create a second LLC from these contributions at a later stage.

I did a lot of research about fees and used iraservices.com as the custodian (lowest fees that I could find) and mysolo401k.net to create the LLC for $800 (they work together with the custodian).

I hope this is useful, and most importantly, factually correct (Any experts seeing something wrong with this, feel free to correct me).

Jean

Hello,

I am trying to find a solution to do a cash out refinance on a property in Nevada purchased 2 years ago, recently appraised for $192k and that does not currently have any mortgage on it.

Because I own more than 4 financed properties, I cannot go the conventional route because Fannie/Freddie rules do not allow cash out past 4 financed properties (or so I am told).

Now to my question: I know that I am supposed to talk to small local banks and find one that keeps loans inhouse (portfolio lender) so they do not care about Freddie/Fannie. I have spoken to several local banks, and I always end up with their commercial lending department, and the longest they will fix rates is for 5 years. For example several banks offered a 10 year loan with a rerate at 5 years.

What I would like to know from people that have already done this, is whether it is realistic to find a local portfolio lender that will offer a 30 y loan with a rate fixed for 30 y, or is this only possible thanks to government involvement on conventional loans?
There are still dozens of more banks I could call, but if 30y fixed doesn't exist in the commercial loan space, then I don't want to be wasting my and their time...

Thank you!

Jean

PS: I am aware that B2R is working on a 30y fixed, single property program, but it is not ready yet, and First Key may offer something like this but they do not lend in Nevada. I'd be happy to learn about any other national lenders to talk to.

Thanks for posting this Billy, very informative.

Jean

That's interesting, I'm also in Nevada and on every shortsale I've ever participated in as a buyer, the bank (seller) always chose the title company, and the selling agent always stated that I couldn't pick my own title company.

I've also done a conventional sale as a buyer, and was also told by the selling agent that the seller insisted on using a particular title co...

Jean

Hello,

thank you to everyone who replied so quickly! I think the responses are pretty clear, and confirm my suspicions. Not grey but black, and I don't do either :-) That's precisely why I was asking first!

@Jon Holdman

You're saying that the IRA would be subject to rules about residential loans if it lends money. Is there a difference between this type of loan, and the shorter term private money loans that I read about on these boards and that flippers/wholesellers use? Could you point me to some reading materials explaining what is subject to rules/regulations and what is not?

Thank you!

PS: Let me know if it's against forum rules to switch topics within a post...

Jean

Hello,

I have an interesting idea to deploy funds from my self directed IRA (SDIRA) into mortgage notes, which I determined is a good way to invest my IRA funds.

I understand that I am not allowed to lend funds from the SDIRA to myself, as I am a related party and this would be a prohibited transaction. I am also not able to have the SDIRA buy a house (or invest into a house) that I own, for the same reason.

However I am looking for advice as to whether the following transaction would be prohibited or not:

I (directly, not through my IRA) purchased a property at 65% of market value, and I am now thinking of selling it with owner financing, in order to create a mortgage note for my SDIRA. I would go and sell the property on the open market to a legitimate and unrelated third party who in turn would take a private mortgage from my SDIRA to pay for the property.

The SDIRA would not be giving me money, it would be loaning money to a legitimate 3rd party who would use these funds to purchase a property from me. But even though there is a title company and escrow account involved, the same funds that the buyer would loan from my IRA would eventually get released to me by the title company when the escrow closes.

What do you guys think about this? Has this been done before? Is it too risky and grey?

Thank you!

Jean

I'm mostly interested in seeing if the market goes up or down over time. I would think that Zillow's automated valuation model should more or less reflect that, specially in a dense metropolitan area. And for free and no work (as opposed to spending time looking up comps), it's still better than nothing? Of course I wouldn't use Zillow to determine the list price for a home when it was time to sell for example.

Hello,

I am trying to find a property management software (if possible online) that I can use do do accounting for my properties, but that will also track the equity in each property using current market values (is possible pulling them from Zillow, but I'm OK entering them myself) and tracking my mortgages and the additional principal that gets paid off every month.

Ideally, I'd like to have a dashboard that will track the net worth of the portfolio over time, and use not only the rental income, but also any equity increase to determine overall ROI.

I've tried out about 15 online property management solutions, but most of them seem to be built for management companies that manage properties on behalf of third party investors, and are lacking the above features.

Does anyone know about any software that would do the above, without missing some of the essential property management features (such as full ledger accounting for example).

Thank you in advance for your suggestions!

Jean