All Forum Posts by: Jimmy Lin

@Brian Whelan

My local bank did not have a seasoning period for cash purchases. I typically start the refi process right after rehab with signed leases.

For anyone that is looking for a lender.  S$T Bank is the lender I used.

I would recommend them. I used them for my recent primary home purchase as well. They don't have all the bells and whistles the big banks have like mobile banking and their online banking registration is cumbersome. But they have competitive rates and are investor friendly.

@Eric L.

@Eric Yi

That will have to be part of my exit strategy.  

My plan is to leverage all my properties to the neck for the first 5 years.  This way I can have maximum funding to scale and grow my portfolio. Since my original post 11 months ago, I am now at 13 units across 8 properties!  Starting at year 6, I will slow down on acquisition and start pouring available cash flow back into the 1st mortgage.  Snowball that into the 2nd and 3rd and so on. 

Hopefully, by year 10 I will have paid off a significant portion if not all of the mortgage principles for the increase in interest rates to be negligible.  If this is not the case by year 9, I will have to look into potential refi with a new loan or selling and exiting altogether is the market is up.

Update on my loans:  The lender I found in my previous post has recently stopped writing portfolio loans for LLCs.  I had to go to commercial for my 4th loan.  This did not affect me too much besides that the rate went up by 1-1.25% compared to my other loans.  The rate is still competitive since I already built a relationship with the bank.

@Joe White

Lmao. People who rush to buy toilet paper because they think there will be a shortage makes it become a shortage.

@Andrey Y.

I think your perception of cash flow is slightly different from the "cash flow" investors. Cash Flow, by definition is income remaining after all expenses plus estimated CapEx, maintenance, vacancy etc. From your examples, the potential missed rent payments (due to Coronavirus) and CapEx over the years, should have been captured in the estimated monthly vacancy and CapEx.

The investors who are stressing about the missed rent payments may not have accounted for these expenses properly and should learn from this experience. 

As a new investor, my best opportunity to scale is with a cash flow strategy.  I would then divest into more stable appreciating assets with lower cash flow down the line.  Cash flow is realized profit while appreciation is not.  Both are awesome in their own respect.  You may have an opinion that appreciation and rent growth is better, which I don't disagree.  However, talking down on investors who are focusing on the cash flow strategy is disrespectful and down right ignorant, regardless of how successful you are.

@John Teachout

Can you explain why using Draino type products is a bad idea? I actually use it for every turn over. I try to clear all the drains out with that stuff before the next tenant moving in. What don’t I know?

@Alyn Shek

The lender charged me 0.5% points on both properties along with the typical transfer fees.

Thank you @John Kwon.

Update: I went to a real estate meet up, and got convinced to sign up for a 3 day seminar. The seminar was very educational, especially for a new investor. I practically jumped out of the chair when they brought in a mortgage lender from a local bank as a guest speaker. The lender is specialized in working with investors. Needless to say, I jumped on the opportunity! We are now in the process of closing two portfolio loans, 10/1 ARM amortized on 30 years with 4.25% interest. And no, they had no issues with me holding title in my LLC!!

@Joel Braver I have considered doing so, but I would be accruing transfer tax for each title transfer. That would end up being equivalent to 4% or 4 points.