All Forum Posts by: John Matthew Johnston

Hi I am new to commercial loans and I was wondering if i could get some help telling me if these numbers look ok. A little background, we went the commercial route because we are running into DTI issues.

THE NUMBERS:

LOAN 1

Amount $100,000

20 year loan

Rate 4.89

Monthly Payment- $654 + Taxes and Insurance

Four 5 year arms that will be reassessed at 3.5 above FHLB

2% Prepayment penalty if we ever REFI

Loan 2

Amount 61,000

20 year loan

Rate 4.89

Monthly Payment $402 +Taxes and Insurance

Four 5 year arms that will be reassessed at 3.5 above FHLB

2% prepayment penalty if we ever REFI

@Jack Amheiser

Midsize Ranch(so if you have a plumbing leak it doesn’t destroy your house, also serves the older generation)

Natural light

Stainless steel appliances and granite( it really doesn’t cost much more to upgrade the finishes and it sets you apart from other rentals)

Lighting( recessed or nicer pendants)

Bathrooms and kitchens( spacious and nice finishes)

Always location(safety, better tenants)

@Jaron Walling @Matthew Crivelli

Thanks guys for the input, I just finished the rehab and the numbers are exactly what I wrote. I have done about 7 of these brrrrs and haven’t had to keep this much money in the deal. I was just seeing if others would do this deal if it were presented to them. Again appreciate the feed back!

Would you do this deal???

Purchase $200.000

Down money $50,000

Loan $150,000 conventional @3.8%(30yr)

Closing costs $14000

Rehab $60,000

All in 274,000

ARV 280-300

Rents 3000-3400/month

PITI- 1360

Repairs - 150

Capex 150

Vacancy 300

CF 1040-1440/month

@John Matthew Johnston

Also a great school district

4000 sft duplex

Purchase $200,000

Down money $50,000

Closing $14,000

Rehab $60,000

All in $274,000

Rents 1500-1700/side(3000-3400/month)

ARV 280-300K

@Alex Roter Thanks! I’ll check them out!

@Dave Skow Thanks for your reply

@Ned Carey Thank You!

We currently have 5 conventional loans in our name and I met a portfolio lender that tells me that we should start using commercial loans to avoid soon being stuck with DTI problems. I want to Refi out of 2 additional properties and as much as I like a fixed 30 year mortgage the lender is saying I'm about to cripple myself from scaling. Has anyone else moved to commercial to avoid DTI issues?