All Forum Posts by: Joe Hughis

@Robin Boyer - By multifamily, are your referring to 2-4's? or 5+ units.  The qualifications, criteria, outlook can be significantly different.  

@Jonathan C. What city or cities are you targeting?

@Christopher L. - You are welcome. From the lender's POV, it's really not much different. It actually is just a bit more work for yourself and for title. But you can definitely command higher rents for actual Condo's than for apartment units. Keep in mind that you will need to consider the HOA language and standing if there is one in place. There could be covenants there you need to address. But from my experience, nothing that would prevent you from potentially having a great investment. Just know it can can affect your expense line. Cheers!

@Christopher L. - As long as none of the units have been sold and all the units are under one entity (and in one building or combined division), you will be able to find conventional financing for it, regardless of the units having individual APN numbers.  An additional loan covenant would be in place by the lender to affirm that non of the units can be separated. In effect it becomes a whole enclosed cross collateralized loan.  Hope this helps. 

@Brenda Whittaker, @Michael Le is correct.  A traditional lender will not likely allow you to use private money as a down payment.  The underwriting reason is because their loan will most likely not pencil out if they include the debt service you would owe for the down payment.  Moreover, a conventional lender would require them to have a first position.  Good luck trying to find a private money lender who is either okay with not being on title or taking a 2nd position on a property without equity.  Also, there is the factor of having "skin in the game".  Conventional Underwriters, in general, don't want to loan to borrowers who have nothing financially to lose.    

@Gulliver R. - There was a previous BP blog about this subject:  https://www.biggerpockets.com/rei/pay-rent-online-...   

Cheers!

For any interested parties to this project, Riverdale Funding can provide private money financing.  We specialize in getting a borrower funding who doesn't fit into a traditional lender's guidelines or who needs a fast closing.  

Our popular program is our "No Financials Requested. All Credit Accepted." commercial loan program.  Call us or details @  888-368-4983 or email us: [email protected] 

@Wave Taylor - It would be a bit hard to tell how well those units would rent based on the information provided.  Class C+ neighborhoods, though older and generally offering affordable rents, can often be very stable.  I would be concerned with "no living space".  Was the unit altered to add a second bedroom?  If so, you should definitely check if the work was permitted before you consider putting in an offer.  The results of that inspection can tell you if you will end up having to spend significantly more to bring it up to code or revert it back to a former state.  

In regards to your second question, generally if you were to buy a property at trustee auction, you would come in with cash on had to purchase the full bid price.  Besides that, did you have any other specific questions?

@Dan Zamora If you go to the meetup site there are plenty of real estate groups that you can participate in for free in your area.  They are actually quite informative and typically have a wide variety of experience levels.  At the very least, it's a great place to exchange business cards, network, and develop relationships.  I'd also recommend going to the court house auction sales.  Many investors are fairly social before the auction starts or in between offerings.  You don't have to buy anything to go.  Plus it's a good experience to see that side of real estate.

Cheers and best of luck to your investment goals!

@Chris Troutner - Short answer - Not necessarily.  

Buyer's agents use NDNC's to give themselves potential legal recourse to have a claim to commissions for introducing a property to a buyer.  Understandably, from their point of view, they don't want to put in work with a buyer who may ultimately go around them to avoid paying a commission fee.  

Now, the practice of having and NDNC makes sense if the broker is your buyer's agent and/or has legitimate authority to present the property to you, and is for a single property/purpose.  Commercial transactions can take a while to develop.  Sometimes an agent may have an exclusive listing that expires.  They should rightfully be able to have a stake in the sale of the property to a buyer for a certain period of time.   Also, there are also situations where buyers try to purposely circumvent an agent by going directly to the seller and using using a different entity name or even a partner or third party to negotiate on their behalf.  A property executed NDNC could provide legal recourse to an agent in these circumstances.

Unfortunately, the practice of getting NDNC's has been tarnished somewhat by a few agents who simply want to have rights to a commission by attempting to lock in a buyer and pepper a multitude of deals at them so they have a claim that they "introduced" the property to the buyer. These few unscrupulous agents often make erroneous claims about their relationship to the seller and their authority to present the property - they are the proverbial "joker broker".  

This all being said, there is also a lot of grey area when it comes to NDNC's.  For instance, active buyers often get presented with multiple deals and it can be difficult to argue claims that a buyer did or did not already have knowledge of a property.

If you do end up going along with signing an NDNC, my best advise would be to pay attention to the language details and be wary about blanket NDNC's or unreasonable conditions.  Single property/purpose NDNC's work best.  Yes, there are templates for NDNC's but know that you are free to make changes and add/subtract conditions to an NDNC you sign.  

Best of luck and happy investing!