All Forum Posts by: Jeff L.

Look for the ability to refinance as soon as you can. This gets your cash right back in your hands to re-use. Repeat this in a string of deals. The end result is you are accumulating properties that cash flow, but you never actually spend any money. No matter how hard you try, they keep giving it back.

I'm trying to wrap my head around this. How is this different from simply getting mortgages for each property?

Big difference. Scenario: Property cost $70k including rehab ($12k); ARV when done at $100k

Mortgage: The lender will give you (on a good day) 80% of your cost to buy ~ $46,400, and then you need cash for the rest and rehab~$23,600. You now have spent $23,600 and have $30k untapped equity (dormant value).

REFI: You buy/rehab with all cash ~ $70k, then refi based on 75% of the ARV ~ $75,000, and recover all of your cash...plus, an additional $5,000...and only have $25k in dead cash.

....and, it's usually easier to get a refi with seasoning, than it is to get the initial loan to buy/rehab on a NOO.

Thank you for explaining this to me Joe. So, it's usually better only in situations where you rehab it?

0 Votes

Originally posted by @Jeff L.:

Originally posted by @Joe Villeneuve:

I'm trying to wrap my head around this. How is this different from simply getting mortgages for each property?

Sorry for bumping this. Can anyone explain the above to me?

0 Votes

I can't seem to figure out how to send someone a PM without connecting with them. Is it possible?

2 Votes

Originally posted by @Joe Villeneuve:

I'm trying to wrap my head around this. How is this different from simply getting mortgages for each property?

0 Votes

1) For buy and hold rentals, what are some good insurance companies to start with?

2) If you have an LLC, is it the same as purchasing a policy as a person?

3) Is there an easy rule of thumb to estimate insurance costs for houses you're looking at?

0 Votes

I keep reading advice to talk to a lawyer or have a lawyer do certain things for you to make sure everything is good (ie for forming your LLC, and other real estate transactions).

However, I have this notion that lawyers are prohibitively expensive for normal people. I have no experience with lawyers.

Can someone give me a brief rundown of how lawyers work? Do they charge by the hour? What are some typical prices?

0 Votes

1. If I'm registering an LLC outside of my home state, are registered agents basically mail forwarding services?

2. For my LLC, is it important to get a mailbox separate from my personal mail, as to avoid the "alter ego" and co-mingling problem?

3. If you have a loan on your LLC's name, and you have a "personal guarantee" since your LLC has no credit history, does that expose you to liability and piercing the corporate veil, defeating the purpose of the LLC?

0 Votes

Do I visit the bank to get funding before or after finding the property I want to buy?

I'm starting out and have no idea when I'll find the property I'm going to put an offer on. Should I go to the bank now and start the process now?

It seems strange to go mortgage shopping before I know when I'll be making the purchase. Is there a length of time before the "preapproval" expires?

0 Votes

All Forum Posts by: Jeff L.

Jeff L. has started 51 posts and replied 108 times.

Post: Buy & hold

Post: Buy & hold

Post: How do you send a private message without becoming a colleague?

Post: Buy & hold

Post: What is your go-to insurance company? How do you estimate insurance costs?

Post: How much do lawyers cost?

Post: LLC Questions

Post: Do I apply for loans before or after finding the property I want?